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(Alliance News) -Â London's FTSE 100 was looking brighter on Tuesday, rebounding somewhat from the previous session's heavy losses - though travel & leisure stocks continued to struggle amid worries about likely measures to combat a second wave of coronavirus infection.
The FTSE 100 index was up 15.08 points, or 0.3%, at 5,819.37 early Tuesday. The mid-cap FTSE 250 index was down 64,94 points, or 0.4%, at 16,805.84. The AIM All-Share index was up 0.1% at 945.46.
The Cboe UK 100 index was up 0.3% at 578.91. The Cboe 250 was down 0.6% at 14,237.50, and the Cboe Small Companies down 0.2% at 9,005.67.
In mainland Europe, the CAC 40 in Paris was up 0.5%, while the DAX 30 in Frankfurt was up 0.7% early Tuesday.
"The FTSE is looking to claw back some lost ground on the open after experiencing its worst sell off since June in the previous session," said Fiona Cincotta at City Index.
London's blue-chip index shed over 200 points on Monday to end 3.4% lower as Covid-19 infections have begun to pick up again in Europe, with the UK recording another 4,368 cases - levels not seen since early May when the country was still in a stringent lockdown.
The UK government will on Tuesday announce new measures to curb rising coronavirus cases across England, hours after upgrading the virus alert level, with top advisers warning of a surging death toll within two months without immediate action.
Under new rules to come into force on Thursday, English pubs, bars and other hospitality venues will be required to close at 2200 BST while food and drink outlets will be restricted to table service only.
The ramped-up response follows warnings on Monday that the country could see up to 50,000 cases a day by mid-October, and a month later exceed 200 deaths every day.
Sterling was quoted at USD1.2761 early Tuesday, lower than USD1.2795 at the London equities close on Monday.
Cincotta said: "Yesterday we saw the return of the Covid trade, the steep sell-off in travel stocks and hospitality stocks in the face of tougher restrictions for longer. We expect these sectors to remain under pressure whilst Britain moves through the more dangerous Autumn and Winter periods."
British Airways parent International Consolidated Airlines, which shed 12% in Monday's session, continued its slide, down 3.6% in opening dealings on Tuesday. In the FTSE 250, easyJet fell 5.0%.
On the hospitality front on Tuesday, Whitbread shares fell 2.1% in London after reporting a slump in half-year sales amid the closure of its hotels and restaurants, and said it is looking into cutting up to 6,000 jobs.
Total sales were "significantly" down year-on-year in the six months ended August 27, due to the closure of the vast majority of hotels and restaurants for a large chunk of that period.
UK like-for-like sales were down 78% in the first half, with total sales down 77%. UK & International sales were down 77%.
The majority of hotels and restaurants were reopened by the first week of August, and a total of 801 hotels, representing 98% of total UK capacity, were open by the end of August.
Since reopening, UK accommodation sales performance has been ahead of the market, Whitbread said. Occupancy levels have improved on a weekly basis across the entire UK estate, averaging 51% in August, while restaurants got a boost from the UK government's Eat Out to Help Out scheme.
August UK total sales - including both accommodation and food & beverage - were down 39% year-on-year.
With market demand expected to remain at "lower levels" in the short to medium-term, Whitbread said it has decided to enter into consultation on proposals that could result in up to 6,000 redundancies across its hotel and restaurant staff - representing 18% of the total workforce.
Elsewhere in the FTSE 100, Hikma Pharmaceuticals also was lower, falling 3.5% after receiving a "minor" complete response letter from the US Food & Drug Administration in relation to its abbreviated new drug application for a generic version of GlaxoSmithKline's Advair Diskus.
The US regulator sends a complete response letter if it decides to not approve the application in its present form.
The FTSE 100 generic drugmaker said: "Hikma is working closely with the FDA to quickly address the small number of questions raised in the CRL. Once answered, Hikma can expect to receive a response from the FDA within 90 days. Hikma now expects to receive approval for its generic Advair Diskus in early 2021."
As such, Generics revenue is expected to be within a range of USD710 million to USD730 million with a core operating margin around 18% to 19% for 2020.
Glaxo shares were marginally lower, down 0.1%.
Kingfisher rallied 6.4% as its sales recovery continued into the third quarter.
The B&Q owner said sales for the six months to July 31 fell 1.3% to GBP5.92 billion, representing a fall of 1.6% on a like-for-like basis. However, pretax profit surged 62% to GBP398 million amid a decrease in selling & distribution expenses.
"We delivered a resilient financial performance in the first half of the year, with the adverse impact of Covid-19 in Q1 offset by a strong recovery in Q2. This recovery has continued into Q3 to date, with growth across all banners and categories," said Chief Executive Thierry Garnier.
Kingfisher said like-for-like sales were up 20% in the second quarter.
The DIY retailer said it has seen an "encouraging" start to the second half, with third quarter like-for-like sales up 17% up to September 19. However, continued uncertainty over Covid-19 limits visibility on the sales outlook for the remainder of the year.
"Looking forward, while the near-term outlook is uncertain, the longer-term opportunity for Kingfisher is significant. There is a lot more to do, but the new team and new plan is now established in the business, and we are committed to returning Kingfisher to growth," said Garnier.
In the FTSE 250, Beazley slumped 12% as its total estimate for first-party Covid-19 claims was doubled to USD340 million from USD170 million anticipated previously.
Almost all of this increase stems from further event cancellation losses, the FTSE 250 company said.
"This revised figure assumes a resumption to some form of normality in the second half of 2021. Were this not to be the case, we estimate that we would have another USD50 million of further claims net of reinsurance," said Beazley.
Turning to business generally, Beazley said that it continues to see rate improvements, with an overall rate change of 13% at the end of August. The firm estimates that overall growth for 2020 will be in the "mid-teens".
"Looking towards next year we expect these rate improvements to continue, and are again planning for double digit growth in 2021. We have contemplated this growth within our capital planning and, following the equity raise and LOC extension earlier this year, are able to take full advantage of the opportunity that lies ahead of us," said Beazley.
In Asia on Tuesday, the Shanghai Composite ended down 1.3%, while the Hang Seng index in Hong Kong is down 0.8%. Tokyo is closed for a second day Tuesday for Autumn Equinox Day.
Against the yen, the dollar was down at JPY104.57 versus JPY104.65 on Monday afternoon in London.
The euro traded at USD1.1734 early Tuesday, soft on USD1.1745 late Monday.
Gold was quoted at USD1,902.20 an ounce early Tuesday, slightly lower than USD1,904.24 on Monday. Brent oil was trading at USD41.44 a barrel, down from USD41.50 late Monday in London.
The economic events calendar on Tuesday has US existing home sales at 1500 BST.
By Lucy Heming;Â lucyheming@alliancenews.com
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