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(Alliance News) - Stocks in London were continuing to push higher at middy on Tuesday as investors shrugged off the political furore over the AstraZeneca coronavirus vaccine on the continent.
Meanwhile, investors look ahead to the start of the US Federal Reserve meeting.
The FTSE 100 index was up 50.56 points, or 0.6%, at 6,800.26. The mid-cap FTSE 250 index was up 236.39 points, or 1.1%, at 21,758.74. The AIM All-Share index was 0.5% higher at 1,205.55.
The Cboe UK 100 index was up 0.8% at 677.38. The Cboe 250 was up 1.1% at 19,378.66, and the Cboe Small Companies up 0.3% at 13,977.44.
In mainland Europe, the CAC 40 in Paris was up 0.3% while the DAX 30 in Frankfurt was 0.8% higher.
"European equity markets seem to have been dragged higher by their US counterparts, which racked up fresh record highs last night. The USD1.9 trillion spending programme by President Joe Biden has lifted sentiment across the board. It feeds into the broader recovery story too. Even though several European countries have paused the rolling out of the AstraZeneca-Oxford vaccine due to health concerns, the optimism connected to the recovery narrative hasn't been derailed," said CMC Markets analyst David Madden.
US stock market futures were called for a mixed open as the Federal Reserve's much-anticipated policy meeting gets underway, as investors look for a response from Chair Jerome Powell pertaining to the rally in US bond yields that has rattled trading floors.
The Dow Jones Industrial Average is called down 0.1%, the S&P 500 up 0.1% and the Nasdaq Composite up 0.7%.
However, the general consensus is that policymakers will maintain their vast bond-buying scheme and keep rates at record lows until 2023.
"Fed Chair Jay Powell has maintained that the recent rise in yields is a natural consequence of optimism over the prospects of a strong economic rebound in the wake of an economic reopening and another USD1.9 trillion of fiscal stimulus, which has now been signed off, with the next set of payments set to hit US bank accounts in the coming days," said CMC Markets analyst Michael Hewson.
"Powell can insist as much as he likes that rates won't move before 2024, but if the market thinks otherwise there won't be that much he can do to change that shift in perception, which means in the longer term the risk won't be in the long end, it will be in the short end," Hewson added.
In the FTSE 100, AstraZeneca was up 3.2% after the drugmaker said it has extended an existing agreement with the US government to supply up to 500,000 additional doses of AZD7442, a long-acting antibody combination in late-stage development, for the prevention and treatment of Covid-19.
The Anglo-Swedish firm said the new US government deal builds on an agreement from October 2020 that was for a total of 200,000 doses with the US Department of Health & Human Service and Department of Defense. This takes AstraZeneca's total planned US supplies to 700,000 doses.
AstraZeneca said the value of the extended agreement is USD205 million and is contingent on AZD7442 receiving Emergency Use Authorisation from the US Food & Drug Administration.
The total value of current agreements with the US government for the development and supply of AZD7442 in 2021 is about USD726 million, AstraZeneca said. The company does not expect the extended agreement to affect its financial guidance for 2021.
In addition, the World Health Organisation is urging countries to continue using the AstraZeneca Covid-19 vaccine as global medical leaders meet to discuss reports of blood clots.
WHO's global advisory committee on vaccine safety will hold a meeting on Tuesday, while the European Medicines Agency will also meet, with a view to publishing further guidance on Thursday. Soumya Swaminathan, WHO's chief scientist, told a media briefing "we do not want people to panic", as she said no association has been found so far between blood clots and Covid-19 vaccines.
A small number of cases of blood clots in people having the jab have been reported in Europe, prompting several European countries including Germany, France, Italy, Spain, Denmark and Norway to halt rollout of the vaccine. Sweden added itself to the list on Tuesday, saying the move was precautionary.
Barclays was up 2.9%, after Credit Suisse raised the UK lender to Outperform from Neutral.
At the other end of the large-caps, Anglo American was the worst performer, down 2.2%, tracking platinum prices lower, quoted at USD1,207.88 an ounce on Tuesday from USD1,217.72 on Monday. Anglo American Platinum is the world's largest primary producer of platinum, accounting for about 38% of the world's annual supply. Anglo American Platinum was 2.4% lower in Johannesburg.
NatWest Group was the second worst performer, 1.3% lower after the state-backed lender said the UK financial watchdog has opened a criminal investigation into the bank's failure to comply with money laundering regulations.
The UK Financial Conduct Authority started the investigation in July 2017 - covering the period from November 2011 to October 2016 - but has now decided to begin criminal proceedings against National Westminster Bank for alleged failures to comply with money laundering regulations.
NatWest stressed it has been cooperating with the FCA's investigation.
Elsewhere on the regulatory front, Amigo Holdings was down 13%. The guarantor loans provider said the FCA has decided to extend the scope of its current probe so that it can investigate whether Amigo appropriately handled complaints after May 20 and whether Amigo deployed sufficient resources to address complaints in accordance with the voluntary requirement. Amigo maintained it will continue to cooperate fully with the FCA.
Blue-chip Antofagasta was 0.3% lower despite the Chilean copper miner reporting positive annual results.
For 2020, revenue was up 3.3% to USD5.13 billion from USD4.94 billion in 2019. Pretax profit was USD1.41 billion, up 4.4% from USD1.35 billion.
The company's preferred metric, earnings before interest, tax, depreciation and amortisation rose 12% to USD2.74 billion in 2020 from USD2.44 billion the year prior.
The miner declared a final dividend of 48.5 cents per share, bringing the total dividend for the year to 54.7 cents per share, up from 17.8 cents in 2019.
Commenting on the results, analysts at Liberum said: "We have the group as a Sell, given our expectation of negative earnings momentum as copper prices fall in the next few years. Additionally, although the company expect labour negotiations with the plant and mine unions at Los Pelambres to conclude by March, we see potential for disruption from these, largely as a result of the copper price level."
In the FTSE 250, Greggs was up 4.7% after the bakery chain reported its first loss as a London-listed company but said its new year has started better-than-expected.
Chair Ian Durant also noted he has been asked to remain in his role going forward, despite exceeding the time-limits under the UK corporate governance guidelines.
At the other end of the midcaps, 4imprint was the worst performer, 13% lower, after the marketing firm reported a sharp drop in annual profit, and has decided against shareholder payouts but stressed it will return to paying dividends soon.
For the 53 weeks to January 2, 4imprint recorded pretax profit of USD3.8 million, almost wiped out from USD54.0 million in the 52 weeks to January 2, 2019.Direct Marketing underlying operating profit dropped 87% to USD7.6 million.
Revenue plunged 35% to USD560.0 million from USD860.8 million. North America revenue fell 34%, while UK & Ireland revenue slumped 53%.
Owing to the tough results, 4imprint has opted against any dividend payouts for the recent financial year, in effort to conserve cash. It had paid 66.68 pence per share for the year before.
The pound was quoted at USD1.3868 at midday Tuesday, down from USD1.3885 at the London equities close Monday.
The euro was priced at USD1.1950, rising from USD1.1931. Against the Japanese yen, the dollar was trading at JPY109.10, flat from JPY109.08.
Brent oil was priced at USD68.87 a barrel Tuesday midday, lower from USD68.70 late Monday. Gold was trading at USD1,734.45 an ounce, up slightly from USD1,730.28.
The economic events calendar on Tuesday has US retail sales at 1230 GMT.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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