London close: Stocks finish higher despite Covid concerns
London stocks remained in the green on Friday afternoon to close in positive territory, despite ongoing concerns about a rise in new coronavirus cases and a gloomy economic forecast from ratings agency Moody’s.
The FTSE 100 ended the session up 0.76% at 6,095.41, and the FTSE 250 was 1.15% firmer at 17,179.97.
Sterling was stronger against both of its major trading pairs, last rising 0.37% on the dollar to $1.2653, and advancing 0.07% against the euro to €1.1180.
“Without any positive updates on what should be the market’s main preoccupation - the ongoing acceleration of the Covid-19 pandemic globally - Western indices still swung into the green on Friday,” said Spreadex analyst Connor Campbell.
He noted that traders seemed to be ignoring the latest daily Covid-19 case numbers out of the US of more than 60,000, with Wall Street stocks following their European peers in the afternoon.
“It is worth pointing out, however, that this time on Thursday the Dow was in a similar position; come closing time it was down 360 points.
“Despite Moody’s warning that the UK economy is heading for a 10.1% contraction in 2020 - a situation more severe than any other G20 nation - the FTSE felt comfortable enough to engage with the session’s optimism.
“That leaves the index just shy of 6100, still a marked decline from Monday’s 6300-plus peak.”
Going into next week, Campbell said markets would have “far more to work with” than they did this week, notwithstanding the weekend’s coronavirus headlines on an otherwise quiet Monday.
“China is the big player, with its second quarter growth - or will it be contraction - reading on Thursday the undoubted highlight, while there’s also UK GDP and jobs data, and an ECB rate vote and subsequent press conference.”
Moody’s said earlier that the UK’s economy will shrink by more than 10% this year - the worst impact among major economies from the Covid-19 crisis.
Britain's GDP will contract by 10.1% in 2020 and will recover gradually next year helped by measures announced by Chancellor Rishi Sunak, Moody's said.
But the agency said government support would cause government debt to surge.
“The extensive policy response provides support to the economy against the continuing challenges posed by the coronavirus-induced shock,” the ratings agency said.
“Our forecast estimates a sharper peak-to-trough contraction for the UK than for any other G20 economy.”
In equity markets, Petropavlovsk shares rose 9.21% after one of its investors called for a shareholder meeting to remove Peter Hambro and four other directors who were installed in a boardroom coup.
The Russian gold miner said it would hold a meeting at the request of Everest Alliance, which holds about 5% of the company's shares.
Everest wants Hambro, Alya Samokhvalova, Johnny Martin Smith, Martin Smith and Angelica Phillips to leave the board after they were elected on 30 June.
It proposed two new directors and wants four current directors to be kept on before the meeting.
On the downside, insurer Hastings slid 6.93% after Goldman Sachs placed 22 million shares in the company.
London commercial landlord Great Portland Estates reversed earlier gains to close down 0.59%, after saying it had collected 69% of June rent to date including amounts covered by rent deposits as tenants felt the pressure of the coronavirus lockdown.
That figure slumped to 58% when deposits were excluded with 74% collected from office tenants.
Just 28% came in from retail, hospitality and leisure sectors clients, hit hardest by the shuttering.
FTSE 100 - Risers
Barclays (BARC) 117.90p 5.31%
Whitbread (WTB) 2,268.00p 4.81%
Rolls-Royce Holdings (RR.) 266.70p 4.06%
Melrose Industries (MRO) 118.25p 4.05%
Homeserve (HSV) 1,301.00p 4.00%
Evraz (EVR) 299.10p 3.78%
Legal & General Group (LGEN) 220.40p 3.62%
Sainsbury (J) (SBRY) 193.75p 3.39%
Royal Bank of Scotland Group (RBS) 122.05p 3.39%
Bunzl (BNZL) 2,203.00p 3.38%
FTSE 100 - Fallers
Associated British Foods (ABF) 1,937.00p -1.92%
Hikma Pharmaceuticals (HIK) 2,105.00p -1.73%
Burberry Group (BRBY) 1,556.00p -1.27%
British American Tobacco (BATS) 2,883.00p -1.27%
GlaxoSmithKline (GSK) 1,573.60p -1.21%
Hargreaves Lansdown (HL.) 1,553.50p -0.99%
Intertek Group (ITRK) 5,348.00p -0.93%
London Stock Exchange Group (LSE) 8,352.00p -0.88%
Just Eat Takeaway.Com N.V. (CDI) (JET) 8,424.00p -0.75%
BAE Systems (BA.) 474.50p -0.71%
FTSE 250 - Risers
Mitchells & Butlers (MAB) 165.00p 9.56%
Petropavlovsk (POG) 28.40p 9.02%
PPHE Hotel Group Ltd (PPH) 1,145.00p 7.51%
CLS Holdings (CLI) 199.40p 7.20%
Apax Global Alpha Limited (APAX) 150.00p 6.84%
Network International Holdings (NETW) 454.60p 6.71%
Crest Nicholson Holdings (CRST) 220.80p 5.14%
ICG Enterprise Trust (ICGT) 778.00p 5.14%
Investec (INVP) 172.65p 4.83%
Carnival (CCL) 986.00p 4.45%
FTSE 250 - Fallers
Hastings Group Holdings (HSTG) 175.90p -6.98%
Hammerson (HMSO) 73.38p -5.68%
Micro Focus International (MCRO) 324.10p -3.25%
FirstGroup (FGP) 36.08p -3.11%
Capita (CPI) 37.81p -2.95%
Morgan Advanced Materials (MGAM) 229.50p -2.75%
Mediclinic International (MDC) 257.20p -2.50%
John Laing Group (JLG) 280.40p -2.37%
Energean (ENOG) 487.50p -2.11%
TBC Bank Group (TBCG) 878.00p -2.01%