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(Alliance News) - Stock prices in Europe were higher on Wednesday afternoon, with markets "remarkably calm" despite the US election still being undecided long after polls in the US have closed.
In London, the FTSE 100 index was up 32.30 points, or 0.6% at 5,819.07 midday Wednesday. The blue-chip index had fallen by 1.0% to a low of 5,731.07 during a frenetic open but soon recovered.
The mid-cap FTSE 250 was up 115.10 points, or 0.7%, at 17,606.80 at midday. The AIM All-Share was up 6.29 points, 0.7%, at 965.67.
The Cboe UK 100 index was up 0.7% at 578.61. The Cboe 250 was up 0.7% at 14,845.61. The Cboe Small Companies grew 0.7% at 9,566.20.
The CAC 40 stock index in Paris was up 0.4%, and Frankfurt's DAX 30 up 0.1%.
"Markets are overall remarkably calm so far today despite maximum election uncertainty," noted AxiCorp analyst Stephen Innes.
"Before the election, many investors would have seen a Biden/Republican Senate as the worst outcome due to small fiscal stimulus combined with higher taxes and more regulation. And yet this scenario looks the most likely now and the market seems OK with that outcome."
President Donald Trump prematurely declared victory and sought Supreme Court intervention to stop vote-counting – even as his Democratic rival Joe Biden voiced confidence in his own chances.
In a divisive election cast under the shadow of the coronavirus pandemic that has claimed more than 230,000 lives in the US, Trump appeared to have avoided a Democratic wave predicted by some polls but he still needs key states to secure another four-year term.
Television networks predicted that Biden would be the first Democrat in 24 years to win Arizona, seizing on the southwestern state's changing demographics and the popularity of astronaut Mark Kelly who was projected to win a Senate seat.
But no other states so far have flipped, and Trump won an early prize in Florida, where his hard line against Latin American leftists helped him make inroads among Cuban Americans.
A New York Times tally has Biden currently leading the way with 227 electoral college votes, compared to Trump's 213, though both are still short of the magic 270 mark with a number of key states yet to declare.
US stock index futures were largely in the green, with just the Dow Jones Industrial Average pointed lower, at 0.2%. The S&P 500 was called 0.3% higher and the Nasdaq Composite by a much-higher 1.9%.
A "blue wave" in favour of the Democrats may have meant tighter regulation for the tech sector, but Republicans looked likely to hold the Senate.
Despite retaining the House of Representatives, the path for Democrats to flip control of the US Senate narrowed sharply, after two key Republicans facing tough reelection battles claimed victory. Democrats flipped two Senate seats in western Colorado and Arizona states on Tuesday, networks projected, but Republicans ousted a vulnerable Democrat in Alabama.
In pre-market trade in New York, Facebook gained 2.5%, Apple was up 2.7%, and Google owner Alphabet was 2.9% higher.
In London, pharmaceutical firms were among the better blue-chip performers.
AstraZeneca climbed 4.9%, Hikma 4.1% and GlaxoSmithKline rose 2.3%. A Democratic president and Senate also might have brought more regulation for the pharmaceutical industry.
Royal Mail topped the FTSE 250s, up 8.8% after JPMorgan raised the UK postal service provider to Overweight from Neutral.
Elsewhere, Marks & Spencer was up 5.2%. The retailer's interim performance was better than expected, despite swinging to a pretax loss of GBP87.6 million from a GBP158.8 million profit.
Revenue for the six months to September declined 16% to GBP4.09 billion from GBP4.86 billion a year before.
Stobart Group shares rose 5.1%. The logistics, energy and aviation firm's pretax loss ballooned to GBP77.4 million from GBP15.5 million though the market took heart from "improving trends" at Stobart Energy, as well as the company's plans to exit Stobart Air.
"The group is seeking to exit that business in early course. To that end, it is engaging actively with parties interested in acquiring its stake and with Aer Lingus to enter a new commercial arrangement beyond December 2022 as part of this process," Stobart explained.
Elsewhere on the main market, construction firm Morgan Sindall rose 5.2%. The company said annual pretax profit will top its GBP50 million to GBP60 million guidance range.
Morgan Sindall declared a 21.0 pence per share interim payout, in line with 2019's interim dividend, having put off a decision on a dividend at the time of its half-year results in August.
Commenting on the upcoming lockdown in England, the company said it does not expect any material disruption.
Construction firms such as Morgan Sindall are able to continue operating during the upcoming English lockdown.
In Westminster, UK members of Parliament are to vote on the new four-week coronavirus restrictions, amid warnings the National Health Service will be overwhelmed with thousands more deaths unless action is taken.
With Labour backing the new restrictions, which are due to come into force on Thursday, the government is expected comfortably to win Wednesday's Commons vote.
Nevertheless, UK Prime Minister Boris Johnson is facing a revolt by some Tory backbenchers angry at the impact on civil liberties and the economic damage the measures will cause.
Ahead of the Commons vote, Johnson warned of "fatalities running in the thousands" if no action was taken as cases across the country continued to rise.
At the same time he sought to offer hope, telling Tuesday's Cabinet meeting that the R number – the reproduction rate of the virus – was "only just above 1" and the new measures would bring it back below that threshold.
Turning to forex, the dollar had a strong start to the European session on Wednesday though its gains have eased as New York prepares to open.
The pound was quoted at USD1.3001 on Wednesday midday, down from USD1.3070 at the London equities close on Tuesday. However, sterling was as low as USD1.2915 earlier in trading.
The euro slipped to USD1.1704, from USD1.1729 late Tuesday.
Versus the yen, the dollar fetched JPY104.60, up from JPY104.50 at the London market close on Tuesday.
The UK services sector grew at a much slower pace in October as the hospitality sector was hit by tighter Covid-19 restrictions, according to final survey data.
IHS Markit/CIPS UK services purchasing managers' index business activity index registered 51.4 points in October, staying above the 50.0 no-change mark but down sharply from 56.1 in September.
The UK composite output index - a weighted average of the services score and Monday's manufacturing PMI - came in at 52.1 in October, the worst reading in four months and down from 56.5 in September.
The eurozone's private sector was treading water in October, as manufacturing growth was offset by a decline in the services industry. The single-currency bloc's services activity index dropped to 46.9 in October, the weakest performance since May and painting a troubled picture for the hospitality industry.
"The eurozone data tells a more worrying story and, given the slight lead compared to the UK in terms of implementing a return of increased Covid measures, we feel this may be a signal of what is to come," analysts at broker Jefferies said.
Still to come on Wednesday, the US services PMI will be released at 1445 GMT. Before that, ADP employment figures are released at 1315 GMT. These are an important precursor to the key October nonfarm payrolls data due Friday.
By Eric Cunha; ericcunha@alliancenews.com;
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