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(Alliance News) - Share price gains for oil majors and property firms ensured London's FTSE 100 kept its head above water midday Tuesday, outperforming peers in mainland Europe which slipped into negative territory, failing to take heart from strong sessions in Asia and New York overnight.
"European markets are largely treading water in early trade...Recent fears around Fed tightening remain prevalent despite yesterday's surge, with Jerome Powell due to broach the topic once again when he provides testimony this evening," IG Markets analyst Joshua Mahony commented.
"Clearly the widely anticipated rise in inflation has been over and above the levels anticipated by the Fed, and with the economy on the rise markets will be fixated on just how that dynamic will change the outlook for monetary policy."
US Fed Chair Powell speaks before Congress at 1900 BST on Tuesday.
The FTSE 100 index was up 18.47 points, or 0.3%, at 7,080.76 on Tuesday at midday. The mid-cap FTSE 250 index was up 113.70 points, or 0.5%, at 22,570.78. The AIM All-Share index was down 1.3 points, or 0.1%, at 1,219.71.
The Cboe UK 100 index was up 0.3% at 705.32. The Cboe 250 was 0.5% higher at 20,288.22, and the Cboe Small Companies up 0.3% at 15,212.29.
In mainland Europe, the CAC 40 in Paris was marginally lower, while the DAX 30 in Frankfurt was down 0.1%.
The pound was quoted at USD1.3883 midday on Tuesday in London, down from USD1.3915 at the equity market close on Monday. The euro stood at USD1.1894, down from USD1.1915. Against the yen, the dollar was trading at JPY110.42, up from JPY110.15.
In London, oil majors were among the best performers. Royal Dutch Shell A shares were 1.5% higher, its B stock climbed 2.2% and BP was up 1.3%. TotalEnergies was up 0.8% in Paris, while shares in Chevron and Exxon Mobil rose 2.9% and 3.6% in New York on Monday.
Brent oil was quoted at USD74.49 a barrel early Tuesday in London, up from USD74.21 late Monday, having reached an intraday high of USD75.29.
"Oil prices are on the march once more on supply concerns, helping to lift index heavyweights BP and Royal Dutch Shell and fuelling the FTSE's rise," AJ Bell investment director Russ Mould noted.
Property developers Land Securities and British Land were the best blue-chip performers, rising 4.8% and 4.6%. JPMorgan duo were raised to Overweight from Neutral and the wider property development sector was also lifted by Covid-19 recovery hopes.
Hammerson rose 3.5% and Helical climbed 7.2%.
Pandemic recovery plays in the leisure sector were also higher in London on Tuesday. Wagamama owner Restaurant Group rose 4.1%, Franco Manca owner Fulham Shore was up 3.8% and pub firm JD Wetherspoon climbed 2.4%.
On Monday, UK Prime Minister Boris Johnson said the July 19 date for easing the final restrictions in England is "looking good".
Further, on Tuesday, Health Secretary Matt Hancock said the UK government is "working on" plans for quarantine-free travel for fully vaccinated Britons but added international travel remains a "difficult" area.
Hancock confirmed that ministers are looking at how to scrap the requirement for people to isolate for 10 days on return from an amber list country.
The news boosted London-listed carriers, with British Airways parent International Consolidated Airlines Group up 1.0%, easyJet up 2.1% and Ryanair climbing 1.4%.
Elsewhere in London, Victorian Plumbing shares surged as it began trading on AIM, following the largest-ever float on the junior market.
Shares were trading at 314.72 pence, up 20% from its 262p initial public offering price, giving a market capitalisation of GBP1.02 billion.
Last Thursday, the Skelmersdale, Lancashire-based bathroom products retailer said it planned to raise GBP11.6 million, with existing shareholders selling GBP285.9 million worth of stock, giving a total IPO of GBP297.5 million.
It was valued at GBP850.0 million on admission.
"Today is a landmark day in the history of Victorian Plumbing. The successful completion of our IPO and admission to AIM is an exciting next step on our growth journey," Chief Executive Mark Radcliffe said.
Stocks in New York were called largely flat ahead of Fed Chair Powell's address to US lawmakers. The Dow Jones Industrial Average was called marginally higher and both the S&P 500 and Nasdaq Composite fractionally lower.
"Looking ahead, US stocks are pointing to a subdued start on the open, after strong gains in the previous session and ahead of Fed Chair Powell's appearance. The Dow booked its biggest one-day rally in three months on Monday. However, few are willing to add to those positions before hearing more from Powell," OANDA analyst Sophie Griffiths noted.
Gold was quoted at USD1,785.33 an ounce midday Tuesday, largely flat from USD1,786.00 late Monday.
By Eric Cunha; ericcunha@alliancenews.com
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