London open: Stocks edge up as Smurfit, Dunelm results impress

London stocks edged a little higher in early trade on Wednesday as investors sifted through results from the likes of Smurfit Kappa and Dunelm.

At 0850 GMT, the FTSE 100 was 0.2% higher at 6,543.08, while sterling was 0.2% firmer against the dollar at 1.3842.

Spreadex analyst Connor Campbell said: "It was a timid to Wednesday’s trading, none of the European indices able to match the pace of gains seen in a record-setting Asian session.

"Once again the FTSE started the day by trying, and failing, to put some distance between it and the magnetic lure of 6,500.

"Nothing at the moment would suggest it has the momentum to break through that level, though a strong showing from the US could be enough.

"The FTSE’s biggest problem at the moment is sterling. While the currency got off to a tepid start, it doesn’t take a lot these days for the pound to hit fresh multi-year highs. A 0.2% rise against the dollar, for example, has pushed cable above $1.3835 for the first time since the very start of May 2018.

"The greenback’s weakness in the face of Biden’s stimulus plan, the UK’s robust vaccine rollout, and the receding likelihood of the Bank of England imposing negative interest rates have allowed sterling to have a stellar start to the year."

In equity markets, Smurfit Kappa rallied after the packaging company reported forecast-beating final earnings, boosted by strong demand in Europe and America. Rival DS Smith also gained.

Dunelm pushed higher as the homewares retailer resumed dividend payments and posted a rise in first-half profits, driven by higher online sales as tougher Covid-19 lockdown restrictions closed its stores.

Lancashire Holdings rose after the insurer said full-year pre-tax profit fell to $5.9m from £$119.5m the year before, beating analysts’ expectations for a loss of $31.4m as its investment portfolio recovered.

On the downside, online supermarket Ocado was under the cosh as Barclays reiterated its ‘underweight’ rating on the stock. The bank said it was disappointed and surprised that "2020 did not see any new deals inked".

Watches of Switzerland fell after Apollo Global Management placed 22m shares in the company.

Redrow lost ground even as the housebuilder reinstated dividends and posted an 11% rise in first-half profit, as customers rushed to buy homes before the end of government incentives next month.

Persimmon was also on the back foot after saying it has set aside £75m for the removal of cladding from 26 buildings it constructed ahead of a government announcement about the removal of potentially combustible materials following the Grenfell Tower fire.

Berkeley, Barratt Developments, Crest Nicholson and Vistry were also trading lower.

Market Movers

FTSE 100 (UKX) 6,543.08 0.18%
FTSE 250 (MCX) 21,102.68 -0.05%
techMARK (TASX) 4,146.84 -0.07%

FTSE 100 - Risers

Glencore (GLEN) 269.50p 2.32%
Antofagasta (ANTO) 1,554.50p 2.03%
Smurfit Kappa Group (SKG) 3,612.00p 2.03%
United Utilities Group (UU.) 928.40p 1.80%
Severn Trent (SVT) 2,332.00p 1.75%
SSE (SSE) 1,462.50p 1.70%
National Grid (NG.) 868.60p 1.59%
Rio Tinto (RIO) 5,861.00p 1.58%
Mondi (MNDI) 1,805.00p 1.49%
Anglo American (AAL) 2,627.50p 1.45%

FTSE 100 - Fallers

Ocado Group (OCDO) 2,640.00p -2.22%
JD Sports Fashion (JD.) 794.20p -1.85%
Berkeley Group Holdings (The) (BKG) 4,313.00p -1.80%
Barratt Developments (BDEV) 688.00p -1.38%
Compass Group (CPG) 1,450.00p -1.29%
Persimmon (PSN) 2,751.00p -1.15%
3i Group (III) 1,136.50p -0.92%
International Consolidated Airlines Group SA (CDI) (IAG) 152.55p -0.88%
Next (NXT) 7,782.00p -0.84%
Diageo (DGE) 2,988.00p -0.76%

FTSE 250 - Risers

Dunelm Group (DNLM) 1,349.00p 6.98%
Fidelity China Special Situations (FCSS) 484.00p 2.87%
Lancashire Holdings Limited (LRE) 762.50p 2.35%
Centrica (CNA) 54.22p 2.19%
Petrofac Ltd. (PFC) 123.00p 2.12%
BlackRock World Mining Trust (BRWM) 581.00p 2.11%
WH Smith (SMWH) 1,712.00p 1.78%
Petropavlovsk (POG) 27.95p 1.64%
Greencore Group (GNC) 128.80p 1.34%
Investec (INVP) 201.90p 1.23%

FTSE 250 - Fallers

Micro Focus International (MCRO) 507.40p -3.17%
Watches of Switzerland Group (WOSG) 641.00p -2.73%
Crest Nicholson Holdings (CRST) 324.00p -2.47%
C&C Group (CCR) 245.50p -2.00%
Bellway (BWY) 3,058.00p -1.99%
Vistry Group (VTY) 907.50p -1.84%
SSP Group (SSPG) 328.00p -1.80%
Countryside Properties (CSP) 465.20p -1.65%
Energean (ENOG) 857.90p -1.40%
Avon Rubber (AVON) 3,200.00p -1.39%