Last checked at 
(Alliance News) - The FTSE 100 was higher at midday on Tuesday, as investors hoped that China's push to vaccinate people aged 60 and older could bring an end to the nation's economically damaging zero-Covid policy.
"The widespread protests across China against Covid restrictions seem to have drawn a carrot and stick response from the government. Police have been out in force to prevent further civil disobedience, while news the country plans to ramp up booster shots for the elderly hint at a more pragmatic response to the pandemic," AJ Bell's Russ Mould said.
The FTSE 100 index was up 50.63 points, 0.7%, at 7,524.65. The FTSE 250 was up 22.98 points, 0.1% at 19,314.55, but the AIM All-Share was down 1.83 points, 0.2%, at 849.09.
The Cboe UK 100 was up 0.6% at 752.55, the Cboe UK 250 was down 0.1% at 16,711.66, and the Cboe Small Companies up 0.5% at 16,711.66.
Beijing's National Health Commission pledged to "accelerate the increase in the vaccination rate for people over the age of 80, and continue to increase the vaccination rate for people aged 60-79".
Just 66% of people over 80 are fully vaccinated, NHC officials told a press conference Tuesday, and China has not yet approved mRNA vaccines for public use.
China's low vaccination rates, particularly among the older population, have long been seen as prolonging Beijing's no-tolerance approach to Covid, with even small caseloads met with harsh lockdowns and quarantine.
The vaccine news comes as China's major cities of Beijing and Shanghai were blanketed with security on Tuesday in the wake of nationwide rallies calling for political freedoms and an end to Covid lockdowns.
Oil prices rallied on the prospect of a pick-up in demand from China were Beijing to roll-back some of its zero-Covid measures. Brent oil was quoted at USD86.33 a barrel early Tuesday, up sharply from USD82.84 late Monday.
"The prospect of a return to normality, in an economy that is the world’s largest oil importer, was enough to make oil prices jump, in the first significant price rebound of the last two weeks," commented Ricardo Evangelista at ActivTrades.
Blue-chip energy firms Harbour Energy, Shell and BP were up 1.9%, 1.8% and 1.6%, respectively, on the higher Brent price.
"The FTSE 100 bounced back on Tuesday as the same oil and mining stocks which had driven the index lower yesterday recovered on hopes for an easing of China’s strict zero-Covid policy," Mould said.
Elsewhere in the FTSE 100, Rio Tinto were up 3.3% at midday.
Mineral explorer Bluejay Mining said the processing of data from the Enonkoski nickel-copper-cobalt project in Finland is nearly complete. The Enonkoski project is a part of a joint venture with Rio Tinto and Bluejay. Initial results from the project are "encouraging", Bluejay said.
Shares in Bluejay were up 3.6%.
In the FTSE 250, John Wood Group plunged 12% as it guided for a continued revenue decline in 2022, fall despite trading in the first ten months of the year being in line with its expectations.
John Wood said it expects annual revenue of between USD5.2 billion and USD5.5 billion, down at least 14% compared to USD6.40 billion in 2021, which itself was a 15% drop from USD7.56 billion in 2020.
easyJet was down 4.6% despite reporting a "record bounce back" amid a sharp rise in annual revenue and a significantly narrowed loss.
The low-cost airline said revenue in the financial year that ended September 30 multiplied to GBP5.77 billion from GBP1.46 billion, while its pretax loss narrowed to GBP208 million from GBP1.04 billion.
easyJet credited the relaxation of Covid-19 restrictions and an increase in ancillary product sales for the revenue rise, however, it warned of higher fuel prices and market-wide inflationary pressures in the year ahead.
Costain was up 5.9%. The infrastructure construction firm announced it is partnering with Heathrow Airport to deliver its new investment programme, aimed at changing customer experience and helping the airport on its journey to net-zero.
On AIM, Shearwater plummeted 21% after it reported a significantly widened loss in the first half of its financial year.
The London-based cybersecurity services provider recorded a pretax loss of GBP1.6 million in the six months to September 30, growing from a loss of GBP518,000 the year before. It explained profitability was hit by a weaker pound against the dollar during the period, as it took an unrealised foreign exchange charge on future dollar liabilities.
The dollar's strength stalled on Tuesday after hawkish comments from St Louis Federal Reserve President James Bullard on Monday.
Bullard said markets are underestimating the chances that US central bankers may enact more chunky rate hikes next year to tame inflation.
Bullard affirmed that he believes the Federal Reserve will need to lift the federal funds rate to at least the bottom of a 5% to 7% range. The benchmark rate is currently 3.75% to 4.00%.
The pound was quoted at USD1.2016 at midday on Tuesday in London, down slightly from USD1.2025 at the London equities close on Monday. Against the yen, the dollar was trading at JPY137.99, down from JPY138.89. The euro stood at USD1.0374, flat against USD1.0377 late Monday.
European Central Bank President Christine Lagarde echoed Bullard's hawkishness, saying that eurozone inflation is running at a record high and has not yet peaked as she signalled further interest rate hikes to come.
Lagarde said the ECB has been hiking "at the fastest pace ever" and that more increases would be needed to bring inflation back down to the ECB's two-percent target.
"We still have a way to go and we're not done with inflation so, yes, we will continue to raise interest rates," Lagarde said.
In European equities early Tuesday afternoon, the CAC 40 in Paris was up 0.1%, while the DAX 40 in Frankfurt was flat.
Stocks in New York were called mostly higher on Tuesday. The S&P 500 was called up 0.2%, the Nasdaq Composite was called 0.4% higher, and the Dow Jones Industrials was called flat.
Gold fetched USD1,755.29 an ounce, up sharply from USD1,743.16.
Still to come on Tuesday, there's a provisional consumer price index print from Germany at 1300 GMT.
By Heather Rydings; heatherrydings@alliancenews.com
Copyright 2022 Alliance News Limited. All Rights Reserved.
