London midday: Stocks rally as miners, energy firms push higher
London stocks were still firmly in the black by midday on Tuesday, having taken their cue from a positive session in Asia, with energy firms and miners pacing the gains.
The FTSE 100 was up 1.3% at 7,351.66.
Russ Mould, investment director at AJ Bell, said: "Boom! Periods when the FTSE 100 rises in the region of 1% in a day should be celebrated given how this year has been so gloomy for investors. Today, the fireworks are most definitely lighting up the sky and the UK market is regaining its mojo.
"Miners revved their engines yesterday following the G7 $600 billion infrastructure plan and were striking more gold today as investors continue to flock to the sector.
"Perhaps helping the cause was news that China would reduce the Covid quarantine period for visitors from overseas, perhaps a sign that the Asian superpower’s extra tough pandemic measures might be relaxed going forward. That would help to alleviate fears that commodities demand would be weaker from China if it shut up shop every time a new Covid wave came."
In equity markets, Shell and BP gushed higher as oil prices rose, while miners also gained, with Rio, Glencore and Anglo American all up.
Energy services company Petrofac rose as it said trading and expectations were in line with guidance, adding that its engineering and construction division was set to secure strong order intake in the second half and deliver backlog growth year on year.
Engine maker Rolls-Royce was the standout gainer on the FTSE 100, while aerospace, defence and security firm Babcock was sitting pretty at the top of the FTSE 250.
On the downside, Pennon slumped as it said that water regulator Ofwat will be including South West Water in its investigation into how water and wastewater companies manager their wastewater treatment works.
Severn Trent and United Utilities were also in the red, with a note on the sector by JPMorgan Cazenove also having an impact. JPM downgraded Severn Trent to ‘underweight’ from ‘neutral’.
"The UK water sector has performed well since the start of the regulatory period on 1 April 2020, with all three listed companies delivering strong returns and asset growth, while maintaining dividend growth at least in line with inflation," JPMorgan said.
"However, we are turning cautious on the subsector, given our belief that returns from April 2025 will be lower than the market currently expects."
It put Severn Trent and Pennon on "negative Catalyst Watch" into July 7th, when regulator Ofwat is due to publish a draft methodology for the next regulatory period.
FTSE 100 - Risers
Rolls-Royce Holdings (RR.) 87.11p 6.48%
Centrica (CNA) 86.24p 4.91%
Prudential (PRU) 1,045.00p 3.57%
Shell (SHEL) 2,185.50p 3.46%
BP (BP.) 404.05p 3.18%
Melrose Industries (MRO) 157.80p 2.83%
Rio Tinto (RIO) 5,194.00p 2.83%
Glencore (GLEN) 465.15p 2.74%
BT Group (BT.A) 189.90p 2.68%
Standard Chartered (STAN) 621.80p 2.64%
FTSE 100 - Fallers
Severn Trent (SVT) 2,711.00p -4.98%
Aveva Group (AVV) 2,401.00p -1.96%
Halma (HLMA) 2,010.00p -1.28%
United Utilities Group (UU.) 1,022.50p -1.21%
Kingfisher (KGF) 245.80p -1.17%
Intermediate Capital Group (ICP) 1,402.00p -1.09%
Flutter Entertainment (CDI) (FLTR) 8,648.00p -0.94%
Spirax-Sarco Engineering (SPX) 9,682.00p -0.92%
Howden Joinery Group (HWDN) 616.80p -0.87%
Scottish Mortgage Inv Trust (SMT) 744.00p -0.67%
FTSE 250 - Risers
Babcock International Group (BAB) 326.00p 8.23%
Aston Martin Lagonda Global Holdings (AML) 545.80p 3.45%
Petrofac Ltd. (PFC) 123.00p 3.36%
TBC Bank Group (TBCG) 1,362.00p 3.18%
BMO Commercial Property Trust Limited (BCPT) 118.00p 3.15%
easyJet (EZJ) 415.90p 3.05%
RHI Magnesita N.V. (DI) (RHIM) 2,144.00p 2.88%
Shaftesbury (SHB) 558.50p 2.76%
Playtech (PTEC) 563.50p 2.73%
Plus500 Ltd (DI) (PLUS) 1,665.00p 2.71%
FTSE 250 - Fallers
Pennon Group (PNN) 1,006.00p -5.98%
Baltic Classifieds Group (BCG) 135.80p -3.82%
Abrdn Private Equity Opportunities Trust (APEO) 464.00p -2.73%
Dr. Martens (DOCS) 256.60p -2.36%
Apax Global Alpha Limited (APAX) 180.20p -2.07%
Essentra (ESNT) 266.50p -2.02%
Savills (SVS) 1,083.00p -1.99%
Coats Group (COA) 64.60p -1.97%
Renishaw (RSW) 3,770.00p -1.93%
JPMorgan European Discovery Trust (JEDT) 385.50p -1.66%