London open: Stocks rise ahead of services, manufacturing PMIs
London stocks rose in early trade on Friday, bouncing back from losses in the previous session as investors eyed the release of key UK services and manufacturing data.
At 0825 GMT, the FTSE 100 was up 0.9% at 7,577.18.
London Capital Group analyst Jasper Lawler said: "The World Health Organisation not designating the Wuhan coronavirus an international emergency has taken the fear gauge down a few notches.
"The travel restrictions and cutback Lunar New Year celebrations will have some kind of dampening effect on Chinese growth. Only, based on what the WHO is saying, the same problem will not be felt globally."
On the data front, all eyes will be on Markit’s manufacturing and services PMIs for January, which are due at 0930 GMT.
"Of particular interest will be how much harm rising activity in British services and manufacturing does to the prospects for a January rate cut," said Lawler. "UK services are set to rebound into a more robust state of expansion and the manufacturing contraction should ease. If the PMIs miss expectations we think the doves could still have their last hurrah at next week’s BOE meeting. If the UK PMIs come in as expected or better, a January rate cut really should be off the table."
In corporate news, medical technology firm Smith & Nephew rose after saying it had bought California-based Tusker Medical for an undisclosed sum. Tusker makes ear tubes that can be inserted by doctors under local anaesthetic to treat infections in young children. S&N said it would fund the purchase from existing cash and debt facilities.
On the downside, Marston’s was firmly in the red even as it said that festive Britons helped the pub group to deliver an increase in sales over the Christmas period despite poor weather keeping people at home in the first three weeks of December. The company said trading over the Christmas fortnight was strong, with like-for-like sales growth of 4.5%, compensating for more "subdued trading" earlier in the month.
Just Eat was the worst performer on the FTSE 100 as Takeaway.com said it will delay the timetable for the £6bn merger with its London-listed rival by a week after the Competition and Markets Authority said it plans to investigate the deal. The UK competition watchdog announced late on Thursday that it was considering whether the deal would lead to a "substantial lessening" of competition.
Commenting on the CMA’s announcement, Neil Wilson, chief market analyst at Markets.com, said: "It is hard to see why the CMA - however fickle it has been in the past - would not let this deal go through.
"It strikes me as a little bit last-minute.com and not likely to stop the merger. There does not appear much rationale to worry about competition concerns."
Elsewhere, NMC Health was weaker after Dubai’s Emirates NBD Bank sold just under 2.2m shares in the UAE healthcare provider.
FTSE 100 - Risers
Auto Trader Group (AUTO) 590.40p 2.54%
Experian (EXPN) 2,681.00p 2.45%
Evraz (EVR) 382.90p 2.19%
Glencore (GLEN) 232.90p 2.08%
Legal & General Group (LGEN) 312.70p 2.02%
Royal Bank of Scotland Group (RBS) 223.20p 1.87%
Berkeley Group Holdings (The) (BKG) 5,452.00p 1.87%
Anglo American (AAL) 2,153.00p 1.84%
Barratt Developments (BDEV) 811.20p 1.76%
Carnival (CCL) 3,514.00p 1.74%
FTSE 100 - Fallers
Just Eat (JE.) 854.00p -3.02%
NMC Health (NMC) 1,375.00p -2.10%
Rightmove (RMV) 668.80p -0.36%
Diageo (DGE) 3,205.50p -0.36%
Burberry Group (BRBY) 2,093.00p -0.05%
Spirax-Sarco Engineering (SPX) 9,015.00p 0.00%
RSA Insurance Group (RSA) 549.60p 0.00%
GlaxoSmithKline (GSK) 1,824.80p 0.10%
BT Group (BT.A) 171.48p 0.28%
BAE Systems (BA.) 640.40p 0.28%
FTSE 250 - Risers
Vivo Energy (VVO) 118.60p 4.59%
Virgin Money UK (VMUK) 172.15p 3.39%
Galliford Try (GFRD) 138.80p 3.30%
Coats Group (COA) 78.95p 2.93%
Drax Group (DRX) 288.40p 2.71%
Wood Group (John) (WG.) 398.30p 2.58%
Investec (INVP) 444.20p 2.42%
Tullow Oil (TLW) 51.16p 2.32%
Ferrexpo (FXPO) 149.00p 2.19%
Kaz Minerals (KAZ) 482.10p 2.10%
FTSE 250 - Fallers
Marston's (MARS) 112.50p -4.01%
Essentra (ESNT) 415.20p -1.84%
Pets at Home Group (PETS) 278.80p -1.83%
Great Portland Estates (GPOR) 939.80p -0.57%
Brewin Dolphin Holdings (BRW) 362.00p -0.55%
Lancashire Holdings Limited (LRE) 749.50p -0.46%
QinetiQ Group (QQ.) 359.20p -0.33%
Ashmore Group (ASHM) 558.50p -0.27%
John Laing Group (JLG) 370.80p -0.22%
Moneysupermarket.com Group (MONY) 321.60p -0.19%