Antofagasta Share News (ANTO)

(Alliance News) - London's FTSE 100 outpaced peers at the start of the week, with a Chinese trade data undershoot hitting the sizeable mining contingent in the index but this being outweighed by a boost for the UK housebuilding sector.

The large-cap index was up 21.64 points, or 0.3%, at 7,090.68 on Monday. The mid-cap FTSE 250 index was up 92.50 points, or 0.2%, at 22,925.23. The AIM All-Share index was flat at 1,257.26.

The Cboe UK 100 index was up 0.3% at 706.51. The Cboe 250 was up 0.4% at 20,672.72, and the Cboe Small Companies flat at 15,177.26.

In mainland Europe, the CAC 40 in Paris and the DAX 30 in Frankfurt were both up 0.1% on Monday.

"The tailwind from the weaker-than-expected non-farm payroll report has faded, and sentiment has taken a turn for the worse following downbeat Chinese trade data. Miners are trading down around 1%, tracing base metal prices lower after Chinese export data sparked concern," said Sophie Griffiths, market analyst at Oanda.

China's exports rose 28% in May while imports grew at the fastest pace in more than a decade as the global economy powers back from the pandemic crisis, official data showed overnight. While growth was strong, it failed to live up to expectations of a 32% gain.

Import growth hit its highest rate since January 2011, coming in at 51% on-year, also slightly below expectations of a Bloomberg poll of analysts.

London-listed miners fell in response to the trade data, as China is a major consumer of commodities. Anglo American, which completed demerger of its thermal coal business in South Africa on Monday, was the worst performer in the FTSE 100, down 2.8%. Antofagasta fell 2.1% and Glencore pulled back 1.1%.

More than offsetting the mining sector slide, housebuilders rallied, after Halifax reported that UK house prices hit a fresh record last month.

Persimmon was up 2.8% at midday, Taylor Wimpey up 2.6% and Barratt Developments up 2.4%.

Home prices jumped 9.5% in May on an annual basis, and notched up a monthly gain of 1.3%. The average UK property price now stands at GBP261,743, a new record high, Halifax said. Annual house price inflation is at its strongest level in nearly seven years.

"Heading into the traditionally busy summer period, market activity continues to be boosted by the government's stamp duty holiday, with prospective buyers racing to complete purchases in time to benefit from the maximum tax break ahead of June's deadline, after which there will be a phased return to full rates," said Russell Galley, managing director at Halifax.

Mid-cap housebuilders also advanced, with Crest Nicholson up 3.8%, Redrow up 2.8% and Bellway up 2.7%.

Wall Street is on course to open slightly lower on Monday, with the Dow Jones seen flat, the S&P 500 called down 0.2% and the Nasdaq Composite down 0.5%.

Pierre Veyret, technical analyst at ActivTrades, said: "Investors are still digesting last week's lower-than-expected jobs report...Market sentiment is also being weighed down by Janet Yellen's recent hawkish comments after she said 'slightly higher rates would be a plus', which clearly increases the prospect of taper talks."

Further, traders are anticipating US inflation data later this week. Due on Thursday, the US consumer price index is expected to show annual growth of 4.7% for May, according to FXStreet, which would mark another uptick after April's 4.2% increase.

The dollar edged higher amid caution at the start of the week.

Sterling was quoted at USD1.4138 on Monday, easing from USD1.4169 at the London equities close on Friday.

The euro traded at USD1.2159, down from USD1.2172 late Friday.

German industrial orders unexpectedly fell for the first time in four months in April. Orders were down 0.2% compared to March, according to federal statistics office Destatis, though analysts surveyed by financial data firm Factset had expected another month of growth.

On an annual basis, however, new orders surged by 79% compared to April 2020, when they dropped to their lowest level on record as economic activity shut down due to the coronavirus pandemic.

The safe-haven yen was stable, with the dollar quoted at JPY109.43 on Monday versus JPY109.44 late Friday in London.

Gold was priced at USD1,884.89 an ounce on Monday, lower than USD1,893.48 on Friday. Brent oil was trading at USD71.46 a barrel, soft on USD71.55 late Friday.

Back on the London Stock Exchange, Legal & General rose 1.7% after Goldman Sachs started the life insurance and pensions firm with a Buy rating.

IWG shares tumbled 14% as it warned 2021 earnings face a hit with occupancy rates lower than expected.

The office space provider said underlying earnings before interest, tax, depreciation and amortisation this year will be "well below" the 2020 level. The improvement in occupancy has been lower than expected because of the prolonged effects of the pandemic, the company said.

IWG made GBP1.23 billion adjusted Ebitda in 2020, down 17% from GBP1.48 million in 2019. Back in April, IWG had said that the first quarter of 2021 was an inflection point and that occupancy would increase throughout the second quarter.

The company offered a silver lining in the trading update on Monday, saying it is seeing unprecedented demand for flexible work products and occupancy is improving in the US. Expectations for a strong recovery in 2022 are "broadly unchanged".

The company's comments came as Health Secretary Matt Hancock said the UK government was "absolutely open" to delaying the June 21 unlocking of England. He also implied that social distancing could continue beyond the final stage of the prime minister's road map.

NetScientific shares soared 47% after its subsidiary inked a contract with FTSE 100-listed AstraZeneca for its serology test.

ProAxsis said it has entered into an exclusive licensing agreement with AstraZeneca which will see ProAxsis take responsibility for completing the validation and global commercialisation of a SARS-CoV-2 serology ELISA developed by an internal research team at AstraZeneca. ELISA refers to an enzyme-linked immunosorbent assay.

In return for providing access to the required intellectual property and technical know-how, AstraZeneca will receive a royalty fee on future global net sales of the assay.

AstraZeneca shares were down 0.6% at midday.

By Lucy Heming; lucyheming@alliancenews.com

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