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(Alliance News) - Stock prices in London were continuing to rally at midday Monday on hopes for an end to the UK lockdown amid impressive headway on the vaccination programme.
UK Prime Minister Boris Johnson will this week begin considering how restrictions in England may be eased ahead of a statement on Monday next week setting out his "road-map" out of lockdown.
More than 15 million people across the UK have received their first dose of a vaccine, more than 20% of the population.
The passing of the 15 million vaccinations mark paves the way for the next phase of the the rollout - covering the next five priority groups, including the over 50s - to begin.
NHS England has already sent out 1.2 million invitations to people over 65 to book an appointment, with a similar number expected to go out this week.
The UK government is aiming to get an offer of a vaccine to the estimated 17 million people in the next five groups by the end of April.
London's blue-chip FTSE 100 index was up 92.48 points, or 1.4%, at 6,682.27 at midday. The FTSE 250 index was up 272.39 points, or 1.4%, at 21,309.76, and the AIM All-Share index was up 5.89 points, or 0.5%, at 1,225.74.
The Cboe UK 100 index was up 1.5% at 664.81 points. The Cboe 250 was up 1.4% at 18,749.02, and the Cboe Small Companies was up 0.7% at 12,746.71.
The CAC 40 in Paris was up 1.2% and Frankfurt's DAX 30 was up 0.4%.
"Government attempts to manage expectations on Covid better are helpful to the market which is now probably pleasantly surprised at just how quickly the UK has vaccinated the most vulnerable sections of its population," said AJ Bell's Russ Mould. "This is making it easier for investors to look through to a reopening of the economy even if the pace at which restrictions are eased remains a topic of fierce debate."
In the FTSE 100, British Airways parent International Consolidated Airlines was the best performer, up 7.0%, following the positive vaccine developments.
In the FTSE 250, travel concessions operator SSP Group was up 11% and multiplex chain Cineworld was up 10%. Pub chains Mitchells & Butlers and JD Wetherspoon were up 6.1% and 3.7% respectively.
Mitchells & Butlers said Monday it intends to raise GBP350 million through a fully underwritten, pre-emptive open offer amid a "bleak" outlook otherwise. The pub chain also has agreed with its lenders for a new GBP150 million 3-year unsecured revolving credit facility.
Also Monday, JD Wetherspoon Chair Tim Martin called on the UK government to allow pubs to reopen at the same time as non-essential shops, warning the industry is "on its knees" and needs to reopen to save jobs. At the end of January, Wetherspoon raised almost GBP94 million in a share placing to weather the latest period of pub closures.
IG Group's Josh Mahony said: "We have already seen the so-called 'Covid recovery group' push Johnson to commit on an April removal of all restrictions, and while that may somewhat optimistic, it is no doubt a reminder of the possible economic surge that could be around the corner.
"Both scientists and politicians alike have expressed optimism that this could be the final lockdown, with value stocks understandably gaining traction at the prospect of an economic reopening in the coming months. Thus it comes as no surprise to see the FTSE gains headed up by stocks in heavily hit sectors such as travel, pubs, banks, restaurants groups, and hotels."
Miners Anglo America, Glencore and Rio Tinto were up 5.4%, 4.9% and 5.0% as commodity prices rose.
Spot platinum surged to USD1,285.81 an ounce on Monday, from USD1,229 on Friday, and spot palladium was quoted at USD2,404 an ounce, up from USD2,358.50.
"Energy and Miners continue to outperform as the risk-on move we saw on Friday continues, with US stimulus lifting all boats. After a week of consolidation in Europe, it feels like the path of least resistance remains higher, as calls grow more vocal for an increase in the pace of reopening and the positive implications that would have for some areas of the market," said Axi's Stephen Innes.
Brent oil was quoted at USD63.37 a barrel Monday at midday, sharply higher from USD61.53 late Friday, trading at fresh 13-month highs.
"Optimism about the vaccine roll out is ensuring markets remain in 'risk on' mode. This, in conjunction with the huge liquidity injected by central banks, is pulling up stock markets. This positivity is also impacting oil, with both the main benchmarks recently climbing to their highest in 12 months, including WTI breaking through the psychological threshold of USD60," said analysts at ActivTrades.
The pound was quoted at USD1.3909 Monday at midday, up sharply from USD1.3847 at the London equities close Friday, trading around its highest levels since April 2018.
"Investors are hoping that the UK's relatively rapid vaccine roll-out programme will support the recovery in the economy this year," explained analysts at Rabo Bank.
The euro was priced at USD1.2140, higher from USD1.2120. Against the yen, the dollar was trading at JPY105.25, up from JPY104.95.
Gold was trading at USD1,820.60 an ounce, down from USD1,828.25, as demand for the safe-haven metal waned.
Financial markets in the US are closed on Monday for the President's Day holiday.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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