London open: Stocks rise as investors eye US politics
London equity markets rose in early trade on Wednesday, with oil stocks lending support, as investors bet on a Democratic win in a US Senate run-off election in Georgia.
At 0900 GMT, the FTSE 100 was up 0.9% at 6,668.98.
Spreadex analyst Connor Campbell said: "With Saudi Arabia agreeing to a cut in output, oil was able to strike an 11-month high, prompting some rather larger gains for BP, up 4.4%, and Shell, rising 2.5%. And when those giants are in a good mood it tends to bode well for the FTSE - the UK index rose close to 1%, returning to the 10-month peak it fell from on Monday following the announcement of Lockdown 3.0.
"It seems that investors have fully moved past Boris Johnson’s latest restrictions, even if they are the most severe since the initial lockdown in March 2020. Overfamiliarity tends to breed apathy in the markets, and that is just as true of covid-19 headlines - which are more alarming now than they have been at any point in the pandemic - as it is of lockdowns. That and it appears the pull of the New Year’s vaccine hopes are stronger than any concerns over the economic impact of these fresh measures."
Campbell said the US Senate election results coming out of Georgia were also playing their part in the FTSE’s gains. He noted that victory has already been called for Democrat Raphael Warnock over Republican Kelly Loeffler, while in the other race Jon Ossoff currently leads against the incumbent David Perdue.
Campbell said this was the ideal outcome for investors, with a Democrat-controlled Senate able to produce a far more substantial stimulus package than, for example, the bill agreed before Christmas.
In equity markets, banks were the standout gainers, with Standard Chartered, HSBC, Barclays, NatWest and Lloyds all firmer.
They were closely followed by oil stocks, while High Street bakery chain Greggs surged after it said its sales decline had slowed but warned that profits would not return to pre-Covid levels until 2022 at the earliest as it forecast a £15m loss this year and revealed 820 job losses.
Informa rose after it said 2020 results would be in line with guidance as the company’s subscription businesses helped offset the impact of Covid-19 on its events operations. Annual revenue will be between £1.65bn and £1.68bn and adjusted operating profit will be £250m-£270m, it said.
Marks & Spencer was in the black following reports it is close to buying Jaeger, the loss-making fashion brand hit by the Covid-19 crisis.
Elsewhere, Vodafone was boosted by an upgrade to ‘buy’ at Berenberg.
Market Movers
FTSE 100 (UKX) 6,668.98 0.86%
FTSE 250 (MCX) 20,778.56 0.30%
techMARK (TASX) 4,152.69 0.15%
FTSE 100 - Risers
Standard Chartered (STAN) 495.80p 6.37%
HSBC Holdings (HSBA) 399.50p 5.52%
Barclays (BARC) 149.78p 4.59%
CRH (CRH) 3,279.00p 4.59%
NATWEST GROUP PLC ORD 100P (NWG) 163.15p 4.55%
BP (BP.) 284.50p 4.40%
Lloyds Banking Group (LLOY) 36.34p 3.21%
Royal Dutch Shell 'B' (RDSB) 1,380.40p 3.20%
WPP (WPP) 800.20p 2.99%
Aviva (AV.) 337.60p 2.86%
FTSE 100 - Fallers
Bunzl (BNZL) 2,464.00p -2.30%
Ocado Group (OCDO) 2,350.00p -1.92%
Experian (EXPN) 2,805.00p -1.58%
British American Tobacco (BATS) 2,745.50p -1.54%
Reckitt Benckiser Group (RB.) 6,608.00p -1.49%
Fresnillo (FRES) 1,222.00p -1.45%
London Stock Exchange Group (LSE) 8,912.00p -1.37%
Intertek Group (ITRK) 5,726.00p -1.31%
Spirax-Sarco Engineering (SPX) 11,335.00p -1.31%
Just Eat Takeaway.Com N.V. (CDI) (JET) 8,632.00p -1.17%
FTSE 250 - Risers
Greggs (GRG) 1,919.00p 7.81%
Petrofac Ltd. (PFC) 155.40p 4.33%
IP Group (IPO) 108.00p 3.65%
Energean (ENOG) 789.90p 3.48%
Centrica (CNA) 49.09p 2.72%
Ferrexpo (FXPO) 320.00p 2.50%
Babcock International Group (BAB) 273.30p 2.47%
Carnival (CCL) 1,320.00p 2.44%
Trainline (TRN) 470.40p 2.35%
TI Fluid Systems (TIFS) 249.35p 2.21%
FTSE 250 - Fallers
Baillie Gifford US Growth Trust (USA) 308.00p -2.22%
Allianz Technology Trust (ATT) 2,900.00p -2.03%
Polar Capital Technology Trust (PCT) 2,310.00p -1.91%
Centamin (DI) (CEY) 133.05p -1.30%
JPMorgan Japanese Inv Trust (JFJ) 726.00p -1.22%
Capita (CPI) 37.50p -1.21%
Just Eat Takeaway.Com N.V. (CDI) (JET) 8,632.00p -1.17%
LXI Reit (LXI) 121.60p -1.14%
Hochschild Mining (HOC) 229.60p -1.12%
Games Workshop Group (GAW) 11,510.00p -1.12%