London open: Stocks rally on strong US cues

Sharecast
Opening Market Report
07:11, 6th April 2021

(Sharecast News) - London stocks rose in early trade on Tuesday, taking their cue from a record session on Wall Street.
At 0840 BST, the FTSE 100 was up 1.1% at 6,809.31.

Richard Hunter, head of markets at Interactive Investor, noted that Monday was the first chance for US markets to react to the bumper non-farm payrolls figures from Friday, "where a hugely better-than-expected 916,000 jobs were added", while the unemployment rate declined to 6%.

"Coupled with a strong services activity report which also jumped to a record high, and with the vaccination rollout also advancing strongly, gains across the board reflected the renewed optimism," he said.

"Alongside the impending effects of the major stimulus packages on spending and infrastructure, the strength of these economic data also raises hopes that any number of solid readings will now become the order of the day as the nascent US economic recovery moves into full growth mode.

"Today is the first chance for European markets to react to this fresh wave of optimism after an extended weekend, and indeed to the possibility that global economies will be lifted by a recovery which is expected to be led by the US in the first instance.

"For the UK, where a further easing of lockdown restrictions was confirmed by the government, prospects increased for sectors such as the miners, banks, retailers and hospitality to participate in a potential surge in economic activity."

In equity markets, miners were among the biggest gainers as metals price rose, with Rio Tinto, Antofagasta, Anglo American and Glencore all up.

Oil giant BP rose after saying it expects to hit its $35bn net debt target during the first quarter of 2021 after faster-than-expected progress on its disposals programme. The company had forecast raising $4bn to $6bn from disposals and said proceeds would now be at the upper end of this range.

Carnival was the top performer on the FTSE 250 after saying it plans to restart cruising from US ports in July.

Cineworld was also a high riser, with traders pointing to a strong performance from AMC Entertainment in the US on Monday after an analyst at B Riley said it was time to buy the shares. He noted an improving outlook for the balance sheet and a strong opening weekend for 'Godzilla versus Kong'. The analyst also said that AMC was well-positioned to benefit from the return of film audiences post-pandemic and this has had positive read-across to Cineworld, traders said.

Tui advanced even after Prime Minister Boris Johnson said he was "hopeful" foreign travel could resume on 17 May but urged people not to book summer holidays yet as more data is needed before a decision can be made.

Tullow Oil gained after saying it has started a multi-year, multi-well drilling campaign offshore Ghana, drilling the first well at the Jubilee Field on Monday.

Elsewhere, Hikma Pharmaceuticals was boosted by an upgrade to 'overweight' at Morgan Stanley.

AstraZeneca was a little weaker following reports that the Medicines and Healthcare products Regulatory Agency (MHRA) is considering restricting use of the company's Covid-19 vaccine for the under-30s due to blood clot concerns.

Market Movers

FTSE 100 (UKX) 6,809.31 1.07%
FTSE 250 (MCX) 21,937.33 0.94%
techMARK (TASX) 4,290.25 0.69%

FTSE 100 - Risers

SSE (SSE) 1,512.00p 3.77%
Rolls-Royce Holdings (RR.) 112.94p 3.69%
Smiths Group (SMIN) 1,611.50p 2.87%
International Consolidated Airlines Group SA (CDI) (IAG) 214.95p 2.58%
BAE Systems (BA.) 522.80p 2.43%
Rio Tinto (RIO) 5,613.00p 2.43%
M&G (MNG) 214.40p 2.39%
Antofagasta (ANTO) 1,732.00p 2.33%
Anglo American (AAL) 2,966.00p 2.33%
Glencore (GLEN) 292.30p 2.33%

FTSE 100 - Fallers

Ocado Group (OCDO) 2,075.00p -0.81%
BT Group (BT.A) 155.45p -0.64%
AstraZeneca (AZN) 7,138.00p -0.47%
Just Eat Takeaway.Com N.V. (CDI) (JET) 6,861.00p -0.46%
Ashtead Group (AHT) 4,463.00p -0.22%
Whitbread (WTB) 3,483.00p -0.20%
London Stock Exchange Group (LSEG) 7,226.00p -0.11%
Avast (AVST) 458.60p -0.09%
Polymetal International (POLY) 1,426.00p 0.00%
Rentokil Initial (RTO) 500.20p 0.04%

FTSE 250 - Risers

Carnival (CCL) 1,712.00p 5.30%
Cineworld Group (CINE) 104.20p 5.02%
XP Power Ltd. (DI) (XPP) 4,955.00p 4.32%
Hammerson (HMSO) 35.25p 4.23%
Avon Rubber (AVON) 3,454.00p 4.16%
National Express Group (NEX) 328.00p 3.67%
Elementis (ELM) 129.80p 3.43%
TUI AG Reg Shs (DI) (TUI) 393.70p 3.41%
Ferrexpo (FXPO) 367.40p 3.32%
FirstGroup (FGP) 93.95p 3.13%

FTSE 250 - Fallers

Genesis Emerging Markets Fund Ltd Ptg NPV (GSS) 891.00p -2.41%
Energean (ENOG) 837.50p -2.33%
Drax Group (DRX) 408.00p -2.30%
Mitchells & Butlers (MAB) 313.80p -1.63%
Aston Martin Lagonda Global Holdings (AML) 1,994.50p -1.21%
Homeserve (HSV) 1,200.00p -0.99%
Watches of Switzerland Group (WOSG) 684.00p -0.87%
Royal Mail (RMG) 482.10p -0.66%
JTC (JTC) 617.00p -0.64%
Dr. Martens (DOCS) 452.60p -0.53%

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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