London midday: Stocks maintain gains as attention turns to May
London stocks were still in the green by midday on Tuesday ahead of Theresa May's statement to parliament, as investors welcomed signs of improvement in Sino-US trade talks and news that another US government shutdown has been averted.
The FTSE 100 was 0.3% higher at 7,149.80, while the pound was flat against the dollar at 1.2854 and 0.1% lower versus the euro at 1.1393.
Trade relations between the US and China were in focus again, with investors increasingly hopeful after White House Counselor Kellyanne Conway said President Trump wants to meet with Chinese President Xi Jinping "very soon" as the deadline on trade talks between the two nations looms.
Spreadex analyst Connor Campbell said this was "a slight evolution of last week’s claim that the Donald wouldn't be seeing his Chinese counterpart this side of the ceasefire ending".
Meanwhile, market sentiment also got a boost from news that Democrats and Republicans have reached an agreement in principle over border security that will avert another partial government shutdown.
All eyes will be on Prime Minister Theresa May as she addresses MPs just after 1230 GMT, seeking more time to renegotiate her Brexit deal with the European Union. She is expected to ask Parliament to restate its demand to remove the Irish backstop from the Withdrawal Agreement and pledge a further vote if she hasn't brought back a tweaked deal by 27 February.
David Cheetham, chief market analyst XTB, said: "Cynics continue to believe this is simply a ploy to run down the clock further and back parliament into a corner ahead of the Article 50 deadline, which would ultimately leave MPs with a straight choice between her deal and no deal."
Speaking after a dinner with Brexit Secretary Stephen Barclay in Brussels on Monday night, the EU's chief Brexit negotiator Michel Barnier said there would be no renegotiation of the Irish backstop.
On the corporate front, GVC Holdings, Paddy Power Betfair and William Hill all rallied as it emerged that British horse racing wold resume on Wednesday following a six-day shutdown due to equine flu.
Luxury fashion brand Burberry was on the rise as fourth-quarter results from Gucci and YSL owner Kering impressed, defying worries about a slowdown in demand from China.
Equipment rental firm Ashtead advanced as JPMorgan reiterated its 'overweight' rating on the stock, saying it's an "underappreciated cash story".
Stagecoach gained as it confirmed that its subsidiary, East Midlands Trains, has agreed a new short-term rail franchise with the Department for Transport, while CYBG advanced as it said that its wholly-owned subsidiary, Clydesdale Bank, has entered into a joint venture with Salary Finance.
Outside the FTSE 350, shares in struggling department store chain Debenhams surged 33% as it secured a £40m cash injection from its lenders.
On the downside, Plus500 tumbled as it warned that 2019 profit would be "materially lower" than market expectations due to new European Union regulations on financial products. IG Group was also on the back foot.
Indivior was in the red after saying it will petition the US Supreme Court to block a decision by the Court of Appeals of the Federal Circuit to allow other companies to sell their generic versions of its anti-opioid treatment. The company said it assumes that both Dr Reddy's Laboratories and Alvogen Pine Brook will both launch their copycat versions of its Suboxone Film "at risk" of pending court judgments that they are infringing on Indivior's patents.
Tui retreated as it said losses widened in the first quarter, just days after the tour operator downgraded its full-year earnings outlook on the back of warm weather and the weak pound. Underlying losses for the group widened to €83.6m in the three months to the end of December 2018 from €36.7m in the same period a year ago, but revenue ticked up 4.4% to €3.70bn.
Shares in other travel-related stocks also suffered, with easyJet and British Airways parent IAG both lower.
In broker notes, BHP Group was cut to 'neutral' at Goldman Sachs, while Rio Tinto was upgraded to 'buy'.
Hammerson, Segro and British Land were started at 'sector perform' by RBC Capital Markets, while Greggs was cut to 'neutral' from 'buy' at UBS, along with Ashmore.
Meanwhile, HSBC initiated coverage of a host of UK mid cap stocks, including the likes of Meggitt and Auto Trader.
FTSE 100 - Risers
NMC Health (NMC) 2,692.00p 1.58%
Kingfisher (KGF) 231.20p 1.36%
SSE (SSE) 1,188.00p 1.19%
Schroders (SDR) 2,689.00p 1.17%
Hikma Pharmaceuticals (HIK) 1,749.00p 1.16%
DCC (DCC) 6,583.50p 1.13%
Ashtead Group (AHT) 1,992.00p 1.12%
Burberry Group (BRBY) 1,929.00p 1.07%
Melrose Industries (MRO) 161.45p 1.06%
GVC Holdings (GVC) 661.75p 1.03%
FTSE 100 - Fallers
TUI AG Reg Shs (DI) (TUI) 933.00p -2.63%
Sage Group (SGE) 638.80p -1.36%
London Stock Exchange Group (LSE) 4,585.00p -1.16%
Whitbread (WTB) 4,804.00p -1.09%
easyJet (EZJ) 1,273.72p -1.03%
3i Group (III) 912.20p -0.96%
Sainsbury (J) (SBRY) 291.20p -0.92%
Halma (HLMA) 1,486.00p -0.87%
Rentokil Initial (RTO) 351.80p -0.82%
Severn Trent (SVT) 1,977.00p -0.80%
FTSE 250 - Risers
Bakkavor Group (BAKK) 146.80p 4.86%
TI Fluid Systems (TIFS) 177.60p 3.68%
Premier Oil (PMO) 71.15p 3.34%
Ted Baker (TED) 1,946.00p 3.29%
Rank Group (RNK) 170.00p 3.28%
Euromoney Institutional Investor (ERM) 1,334.00p 3.09%
Hays (HAS) 155.50p 2.64%
Convatec Group (CTEC) 146.85p 2.26%
Superdry (SDRY) 504.00p 2.23%
JPMorgan Japanese Inv Trust (JFJ) 377.00p 2.17%
FTSE 250 - Fallers
Plus500 Ltd (DI) (PLUS) 1,101.00p -32.70%
IG Group Holdings (IGG) 585.00p -5.19%
Contour Global (GLO) 165.20p -2.88%
Indivior (INDV) 104.10p -2.76%
Ferrexpo (FXPO) 253.80p -2.65%
Petrofac Ltd. (PFC) 379.64p -2.28%
Britvic (BVIC) 892.00p -2.19%
Hochschild Mining (HOC) 189.10p -1.64%
Clarkson (CKN) 2,465.96p -1.36%
Stobart Group Ltd. (STOB) 147.39p -1.35%