(Alliance News) - Stocks in London were in the green in midday trade on Friday, reversing losses from earlier in the session as markets drift towards the end of the week.
"The markets have found it tough to make tangible progress since early June and that trend continued on Friday," AJ Bell investment director Russ Mould said.
The FTSE 100 index was up 29.59 points, or 0.5%, at 6,079.40 midday Friday, gaining back ground after opening the session 0.4% lower.
The mid-cap FTSE 250 index was 1.2% higher at 17,195.08. The AIM All-Share index was 0.2% higher at 882.38.
Mould added: "The FTSE 100 was flirting with the 6,000 level for the first time since May and bringing to a close a week which has seen investor optimism fade as the global battle with Covid-19 apparently has no end in sight."
The Cboe UK 100 index was up 0.5% at 605.66. The Cboe 250 was 0.9% higher at 14,542.26, and the Cboe Small Companies was down 0.4% at 9,169.23.
In mainland Europe, the CAC 40 in Paris was up 0.1% while the DAX 30 in Frankfurt was 0.2% higher midday Friday.
Stocks in the US are pointed to a lower start on Friday, with the Dow Jones called down 0.6%, the S&P 500 down 0.5% and the Nasdaq expected to open 0.2% lower.
"The WHO warning that the Covid-19 pandemic is still seeing a doubling of infections globally every six weeks, a growing death toll in the US and flare-ups around the world have hurt the mood in markets and everywhere else for that matter," analysts at Societe Generale said.
The US on Thursday posted 65,551 new coronavirus cases, a record for a 24-hour period, according to a tally by Johns Hopkins University.
The country, the hardest-hit in the world by the pandemic, has a total caseload of more than 3.1 million, with 133,195 deaths.
The previous daily record was Tuesday, with more than 60,200 cases in one day. The US has seen a spike in infections in recent weeks, particularly in the south and west, and health experts worry the death rate may soon follow the same trajectory. According to the Johns Hopkins tracker at 0030 GMT Friday, 1,000 people died from Covid-19 in the US in the last 24 hours.
"We're in a very difficult, challenging period right now," top US infectious diseases expert Anthony Fauci said Thursday during a teleconference organised by news outlet The Hill.
In Asia, Hong Kong will close all schools after the territory reported a spike in locally transmitted coronavirus infections, the city's education minister said Friday.
The government has ordered all schools to close from Monday, bringing forward the start of the summer holidays, Kevin Yeung said, after the city recorded an "exponential growth" of locally transmitted cases in the past few days.
The finance hub recorded 34 locally transmitted coronavirus cases on Thursday, the highest daily tally in more than three months.
Authorities had taken the move "for the general good of the community as well as the health of the students," Yeung said.
In London, Barclays was 2.5% higher after Investec raised the FTSE 100-listed lender to Buy from Neutral.
Midcap gold miner Petropavlovsk was 5.2% higher after it said Non-Executive Chair Peter Hambro, Chief Executive Alya Samokhvalova, Non-Executive Directors Johnny Smith, Martin Smith and Angelica Phillips will remain directors after a court requested a full hearing of Everest Alliance's application to remove them from their roles.
Petropavlovsk said that while the judge found that Everest's complaints that the directors were not validly appointed were arguable, he declined to determine its application summarily and instead now requires a full hearing of Everest's application.
Earlier on Friday, Everest - which has a 7.5% stake - requisitioned a general meeting to propose the hire of two new directors.
Senior was down 4.0%. The technology components manufacturer expressed a confident outlook going forward despite expecting to report a revenue fall in the first half of 2020.
Senior reported a "robust" cash performance in the six months to the end of June, with GBP3 million net cash inflow generated during the period, in the face of "significant disruption" to its end markets.
The company said it now expects revenue in the first half of 2020 to be around 30% lower than GBP580.4 million generated in the first half of 2019. Senior said net debt is expected to be GBP239 million at June 30, an improvement of GBP3 million from the end of December 2019.
In 2019, in order to counter the anticipated decline in sales, Senior initiated a restructuring plan.
Reflecting the additional actions which the company is taking, it now expects the total restructuring charge to be up to GBP35 million, an increase from the GBP23 million originally anticipated.
Going forward, Senior said trading for the rest of 2020 continues to be hurt by Covid-19. As a result, guidance for 2020 remains suspended.
Elsewhere on the Main Market, International Personal Finance gained 17% after the home credit lender said it is "well-placed" going forward as its collections effectiveness continued to improve in June.
The company, against the background of Covid-19, is encouraged by the extent to which the company is now stabilising into a "new normal" operational environment.
International Personal Finance said collections effectiveness continued to improve in June, reaching 88% of pre-Covid expectations. It was at 76% in April and 80% in May.
Going forward, the company said it expects collections effectiveness to progressively improve in the coming months.
International Personal Finance said there is a continuing strong demand for its products. As lockdown restrictions are progressively relaxed and the company's collections effectiveness is improved, it said it has increased credit issued. In June the company lent 37% of pre-Covid expectations, up from 30% during both of April and May.
The dollar was stronger against most majors on Friday.
ActivTrades senior analyst Ricardo Evangelista said: "Early Friday trading is under the spell of risk avoidance, offering support to the safe haven dollar. Investors have shown remarkable optimism lately, but the cold reality of more than 60,000 new cases of Covid-19 in the US yesterday has, for now, beaten the positivity out of the markets. These fears of a resurgence of the virus have been compounded by American employment data published yesterday, showing the number of claimants above 18 million and driving fears of a slow economic recovery. Amidst the surge of apprehension, the dollar once again emerges as the go-to currency when risk is off the table."
Sterling was quoted at USD1.2609 early Friday, down on USD1.2615 at the London equities close on Thursday. The euro traded at USD1.1293 early Friday, down from USD1.1297 late Thursday.
The safe haven Japanese yen was an exception, advancing against the greenback amid the risk-off mood. Against the yen, the dollar was quoted at JPY106.82 versus JPY107.27.
Brent oil was trading at USD41.40 a barrel midday Friday, lower than USD42.33 late Thursday, as fears of further lockdowns drove prices lower.
ActivTrades chief analyst Carlo Alberto De Casa commented: "The biggest risk is linked to the possibility of a second wave of the virus and particularly to further closures of economy, which could generate temporary collapses of economies reducing movement of people and fuel demand from the car and airplane sectors. Moreover, in the face of a global recession oil demand will decline, with consequent effects on the price of the barrel. This is definitely another significant risk, as the oversupply scenario seen in recent months could re-emerge if economies slow down."
Safe haven asset gold was quoted at USD1,807.10 an ounce midday Friday, up on USD1,802.2 an ounce at the London equities close Thursday, testing multi-year highs reached during the week.
By Paul McGowan; paulmcgowan@alliancenews.com
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