London close: Stocks manage gains on back of fresh Pfizer news

Market Close Report
11:05, 18th November 2020

(Sharecast News) - London stocks finished in positive territory on Wednesday, as investors mulled UK inflation data and the latest news on the Covid-19 vaccine being developed by Pfizer and BioNTech.
The FTSE 100 ended the session up 0.31% at 6,385.24, and the FTSE 250 was ahead 0.94% at 19,699.87.

Sterling was stronger too, last rising 0.39% on both the dollar and the euro, to $1.3298 and €1.1208, respectively.

Further data from Pfizer and BioNTech's ongoing phase three trial showed the vaccine protected 94% of adults over the age of 65, and worked equally well in people of all races and ethnicities.

The companies said they would now apply for authorisation for emergency use of the jab in the United States.

Stocks surged last week when Pfizer announced the vaccine was 90% effective, while on Monday, markets were boosted by news that Moderna's Covid-19 vaccine was almost 95% effective.

"News of an improvement in the effectiveness of the Pfizer vaccine helped markets to find their footing on what was otherwise an uneventful day, with the trend in vaccine headlines shifting away from blockbuster news that electrifies markets to a more measured response to what is still good news for markets, the global economy and of course the human race," said IG chief market analyst Chris Beauchamp.

"European markets managed to make some reasonable gains while the Dow has added around 100 points as Wall Street responds to the news.

"From here on in the vaccine news is less likely to have a major one day impact, but instead a steady drip-drip of news will help the market to remain steady as it looks for the next major catalyst for further upside after a very strong first half of the month."

Investors were also mulling over the latest figures from the Office for National Statistics, which showed inflation edged higher in October as the price of clothing rose.

Consumer price inflation rose to 0.7% in October from 0.5% in September, topping the 0.6% growth economists had been expecting.

Core inflation, meanwhile, increased to 1.5% from 1.3%, versus expectations for no change.

The largest upward contribution came from clothing and footwear, the ONS said.

Clothing prices rose by 2.8% between September and October, mostly due to a rise in the price of womenswear, compared with a 0.9% increase between the same two months a year ago.

Food prices were up 0.1% compared with a 0.6% decline between the same two months a year ago, with the move higher driven mainly by vegetables and fruit.

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said consumer price inflation looked set to hover close to 0.7% until April, when the energy component would no longer depress the headline rate and some restaurants, hotels and leisure providers would raise prices in response to the return of VAT to its usual 20% rate.

In equity markets, B&Q owner Kingfisher closed up 3.46%, ahead of its third-quarter update on Thursday.

RSA Insurance surged 4.17% after agreeing to be bought for £7.2bn by a consortium comprising Intact Corp of Canada and Denmark's Tryg.

Energy supplier SSE was also up, by 4.38%, as it reported a fall in adjusted operating profit after taking a £115m hit from the coronavirus pandemic, but maintained its interim dividend payout.

Micro Focus rocketed 31.17% after a well-received trading update, while Virgin Money UK was boosted 7.76% by a double-upgrade to 'overweight' at Barclays.

On the downside, British Land lost 2.43% as it posted a decline in underlying half-year profit as the value of its retail assets fell by nearly 15%.

The company also warned that due to concerns about Brexit and Covid-19, office leasing volumes will be lower as customers defer long-term decisions.

Peer Shaftesbury was also in the red, by 2.65%.

Spirax-Sarco Engineering was 3.78% weaker, despite backing its full-year expectations and reporting an improvement in third-quarter trading.

Investment platform Hargreaves Lansdown fell 5.54% after co-founder Stephen Lansdown sold 6.7m shares in the company at 1,535p each - a 5% discount to the closing share price on Tuesday.

Market Movers

FTSE 100 (UKX) 6,385.24 0.31%
FTSE 250 (MCX) 19,699.87 0.94%
techMARK (TASX) 3,983.72 0.88%

FTSE 100 - Risers

RSA Insurance Group (RSA) 676.80p 4.61%
SSE (SSE) 1,402.50p 4.04%
Taylor Wimpey (TW.) 164.75p 3.62%
Kingfisher (KGF) 299.70p 3.59%
Aveva Group (AVV) 4,250.00p 3.41%
Persimmon (PSN) 2,913.00p 3.33%
Imperial Brands (IMB) 1,552.00p 3.09%
Avast (AVST) 457.20p 3.07%
International Consolidated Airlines Group SA (CDI) (IAG) 158.15p 3.06%
JD Sports Fashion (JD.) 810.40p 2.97%

FTSE 100 - Fallers

Hargreaves Lansdown (HL.) 1,526.00p -5.54%
Homeserve (HSV) 1,200.00p -5.29%
DCC (DCC) 5,582.00p -5.04%
Spirax-Sarco Engineering (SPX) 11,465.00p -3.78%
Compass Group (CPG) 1,348.00p -3.06%
British Land Company (BLND) 498.70p -2.41%
Intertek Group (ITRK) 5,992.00p -2.12%
GlaxoSmithKline (GSK) 1,374.80p -2.00%
Halma (HLMA) 2,349.00p -1.67%
Land Securities Group (LAND) 706.70p -1.46%

FTSE 250 - Risers

Micro Focus International (MCRO) 356.40p 31.17%
Rank Group (RNK) 151.00p 7.86%
Virgin Money UK (VMUK) 152.70p 7.76%
CMC Markets (CMCX) 395.00p 7.19%
TBC Bank Group (TBCG) 1,316.00p 6.30%
Cairn Energy (CNE) 160.30p 6.30%
Babcock International Group (BAB) 316.90p 5.92%
TUI AG Reg Shs (DI) (TUI) 431.40p 5.87%
Grafton Group Ut (GFTU) 847.50p 5.02%
BMO Commercial Property Trust Limited (BCPT) 74.10p 4.96%

FTSE 250 - Fallers

SSP Group (SSPG) 327.40p -5.32%
Wood Group (John) (WG.) 275.20p -4.94%
Sabre Insurance Group (SBRE) 265.50p -4.32%
Network International Holdings (NETW) 272.60p -2.71%
Greencore Group (GNC) 118.60p -2.71%
Pagegroup (PAGE) 442.80p -2.64%
Vivo Energy (VVO) 94.50p -2.58%
Dunelm Group (DNLM) 1,208.00p -2.34%
Workspace Group (WKP) 723.00p -2.17%
Kaz Minerals (KAZ) 638.20p -1.82%

Disclaimer & Declaration of Interest

The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.

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