International Airlines Share News (IAG)

(Alliance News) - Stock prices in London opened higher on Monday as coronavirus restrictions in England eased further, while Diploma led the FTSE 250 after reinstating its interim dividend.

UK Prime Minister Boris Johnson has called for a "heavy dose of caution" as indoor socialising and physical contact resumed against the backdrop of concerns over the Indian coronavirus variant.

The PM said "now everyone must play their part" as England pushed ahead with the third stage of the road map out of lockdown on Monday.

Pubs and restaurants will be able to welcome customers back indoors, visits to the homes of friends and family can resume and the foreign holiday ban has ended.

But the measures were eased as top scientists called for caution and warned of a "perilous moment", with the Indian variant feared to be as much as 50% more transmissible than the Kent strain.

Ministers are hoping surge testing and vaccines will allow a safe opening up of the nation, with jabs due to be extended to the over-35s this week.

But UK Health Secretary Matt Hancock did not rule out the possibility of imposing local lockdowns in areas such as Bolton to tackle the Indian variant, which he warned could "spread like wildfire".

The FTSE 100 index was up 17.33 points, or 0.3%, at 7,060.94 early Monday. The mid-cap FTSE 250 index was up 111.97 points, or 0.5%, at 22,447.09. The AIM All-Share index was up 0.3% at 1,240.32.

The Cboe UK 100 index was up 0.3% at 704.60. The Cboe 250 was up 0.5% at 20,194.59, and the Cboe Small Companies up 0.2% at 15,031.41.

In mainland Europe, the CAC 40 in Paris and the DAX 30 in Frankfurt were both up 0.3%.

"It's a big day for many businesses as the UK lifts more Covid-related restrictions. This should have been cause for celebration, but all eyes are on the Indian variant and whether the government is going to impose new lockdowns, be it localised or national," said Russ Mould, investment director at AJ Bell.

In the FTSE 100, gold miners Fresnillo and Polymetal International were up 2.6% and 2.2% respectively, tracking spot gold prices which were trading at three-month highs.

The precious metal was priced at USD1,854.12 an ounce early Monday, higher than USD1,837.50 late Friday.

In the FTSE 250, Diploma was the best performer, up 6.5%, after the technical products supplier said it saw a strong first-half performance and expects its full-year performance ahead of expectations.

For the six months to March 31, revenue at the London-based seals and cables maker was up 29% to GBP365.2 million from GBP283.6 million the year before, and pretax profit increased 2% to GBP42.5 million from GBP41.6 million.

Diploma declared an interim dividend of 12.5 pence per share, having skipped its interim payout last year, which it said reflects its "growth outlook and future prospects".

Turning to acquisitions, Diploma said it had an active "pipeline of opportunities".

Looking ahead, Diploma said: "As a result of the strong trading performance in the first half and positive momentum into the second half, we now expect full-year results significantly ahead of our previous expectations."

Vistry Group was up 2.5% after the housebuilder raised its annual profit guidance after making a positive start to the year.

Vistry said it has seen strong demand across all areas of the business and an average weekly private sales rate of 0.75, up 70% at the same time in 2020.

For the full year, Vistry said housebuilding is on track to deliver a significant step-up in completions to 6,500 units, up from 4,652 in 2020 and ahead of previous guidance. Vistry said its Partnerships unit expects to deliver significant growth in higher-margin mixed-tenure completions in 2021 and is on track to meet its 2022 targets of GBP1 billion revenue and an adjusted operating margin of 10%.

Looking ahead, Vistry said that, due to strong trading in the first half and increased expectations for 2021 house completions, it now expects adjusted pretax profit for 2021 to be GBP325 million, whilst maintaining its expectations for 2022. Vistry had previously guided to adjusted pretax profit of at least GBP310 million.

Elsewhere, Ryanair Holdings was up 1.5% after the Irish carrier said it expects an improvement as coronavirus restrictions ease and it introduces a more efficient airplane.

Ryanair said it swung to a loss for the financial year to the end of March of EUR1.11 billion from EUR648.7 million profit recorded the year before.

Annual revenue fell 81% year-on-year to EUR1.64 billion from EUR8.49 billion, in line with the fall in traffic to just 27.5 million from 148.6 million the year prior. Load factor declined to 71% from 95% year-on-year.

Looking ahead, Ryanair expects first-quarter traffic to be between 5 million and 6 million passengers. It also believes that annual traffic is likely to be towards the lower end of its previously guided range of 80 million to 120 million passengers, which would represent a jump of up to four times year-on-year.

The airline said it thinks financial 2022 will be close to breakeven, assuming vaccine rollouts allow the lifting of intra-European travel restrictions in time for the July to September peak period.

Looking further out, Ryanair will benefit from introduction of the Boeing 737 "gamechanger" aircraft, which it said will improve revenue, with 4% more seats available, while reducing fuel costs.

However, Ryanair's optimism failed to lift peers, with British Airways parent International Consolidated Airlines down 0.2% and easyJet down 1.4% early Monday.

The Japanese Nikkei 225 index closed down 0.9% on Monday. In China, the Shanghai Composite ended up 0.7%, while the Hang Seng index in Hong Kong was up 0.2%. The S&P/ASX 200 in Sydney closed up 0.3%.

China's industrial output recorded strong growth in April after last year's pandemic-induced slump, official data showed, but retail sales picked up by less than expected amid uncertainty in the global economy.

The world's second-largest economy, where the coronavirus first surfaced in late 2019, was also the first to bounce back from strict virus lockdowns. It was a recovery led by factory activity, with Chinese firms producing everything from protective gear to electronics and other consumer goods desired by global consumers stuck at home and ordering online.

Industrial output rose 9.8% on-year last month, in line with expectations. Retail sales grew 18%, but missed expectations for a 25% rise.

The pound was quoted at USD1.4110 early Monday, up from USD1.4088 at the London equities close Friday.

The euro was priced at USD1.2140, flat from USD1.2138. Against the yen, the dollar was trading at JPY109.23, lower from JPY109.40.

Brent oil was quoted at USD68.57 a barrel Monday morning, up from USD68.30 late Friday.

By Arvind Bhunjun; arvindbhunjun@alliancenews.com

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