(Alliance News) - London stock prices remained higher at midday on Thursday but had given back some of the morning's earlier gains as caution crept in ahead of US jobless claims due later.
"What a session we have in store; an OPEC+ meeting, US jobless claims and the final trading day for most heading into the Easter weekend. It's going to be all action," said Craig Erlam at Oanda.
The FTSE 100 index was up 46.40 points, or 0.8%, at 5,724.13 midday Thursday. The mid-cap FTSE 250 index was up 204.69 points, or 1.3%, at 16,067.52, while the AIM All-Share index was up 1.9% at 741.09.
The Cboe UK 100 index was up 1.1% at 9,688.48. The Cboe 250 was up 2.0% at 13,924.55, and the Cboe Small Companies up 0.8% at 8,337.93.
In mainland Europe, the CAC 40 in Paris and the DAX 30 in Frankfurt were down 0.5% and up 0.3% respectively.
"Europe is playing a little catchup this morning after the US rallied into the close and Asia posted decent gains overnight. The withdrawal of Bernie Sanders from the Democratic leadership race seemed to be the catalyst for the move but it came in a market in which investors look pretty keen to jump back in. Sometimes they just need a little nudge," said Oanda's Erlam.
He added: "Overall sentiment in the market looks to be holding up going into the loooooong bank holiday weekend. In times like this, the weekend can feel long as it is. For those holding risk, especially given the trajectory in the US, it may feel very long indeed which may see some exposure cutting into the end of the day."
More than 1.5 million cases of the novel coronavirus have been registered worldwide, according to a tally compiled by AFP on Thursday from official sources. Of the 1.5 million infections, 87,320 people have died across 192 countries.
The US, where the pandemic is spreading most rapidly, has recorded 432,132 cases, including 14,817 deaths.
Europe remains the worst hit continent with 772,592 cases and 61,118 deaths. Spain has declared 146,690 cases with 14,555 deaths, and Italy 139,422 infections with 17,669 deaths.
Wall Street is on course for a mixed open on Thursday, with the Dow Jones pointed up 0.1% but the S&P 500 down 0.1% and the Nasdaq down 0.2%.
Focus lies on two key events this afternoon: OPEC and US jobless claims.
Brent oil was trading at USD34.28, gaining steadily on hopes of action from the world's largest producers to support prices. Oil was quoted at USD31.56 late Wednesday.
Exporting group OPEC and fellow producers such as Russia will hold a teleconference later in the day with expectations growing that they will agree to reduce output to support the struggling market.
Russia has already said it is ready to slash output, fuelling hopes that key producers are poised to seal a deal aimed at boosting energy markets. Oil prices are at near-two-decade lows with travel restrictions and lockdowns imposed to halt the spread of the virus throttling demand, and Riyadh and Moscow are locked in a production war.
Meanwhile, US initial jobless claims will be out at 1330 BST.
"Whether current uplift in sentiment can last the release of US jobless claims this afternoon remains to be seen. Expectations are for 5.25 million to sign up for unemployment benefit in the week ending 3rd April. This would put the total jobless claims over the past three weeks at 15 million, or 10% of the US workforce. Another disastrous reading could see investors flock back towards safe havens, dragging stocks lower," said Fiona Cincotta at City Index.
Safe haven gold was quoted at USD1,663.21 an ounce midday Thursday, up on USD1,650.50 on Wednesday. The Japanese yen also gained ground, with the dollar trading at JPY108.75 versus JPY108.80.
The dollar was lower against most majors ahead of the data.
Sterling was quoted at USD1.2435, up from USD1.2390 at the London equities close on Wednesday. The euro traded at USD1.0878 midday Thursday, up on USD1.0869 late Wednesday.
EU finance ministers will resume efforts on Thursday to agree a rescue plan for Europe's hardest-hit nations after The Netherlands blocked a compromise over bailout conditions.
The 27 ministers will restart their meeting by video-conference at 1500 GMT, after talks broke down on Wednesday following more than 16 hours of ill-tempered negotiations.
The Hague surprised many with its inflexible stance, insisting that Italy, Spain and any others caught short by the outbreak must meet reform conditions if they turn to Europe for financial aid. The sting was made all the worse after Italy and Spain were forced to drop their goal of a joint borrowing instrument, now dubbed "coronabonds", due to the inflexible stance of Germany, the bloc's most powerful member state.
In the UK, coronavirus lockdown measures are expected to be extended beyond three weeks.
After UK Prime Minister Boris Johnson spent a third night in intensive care, Foreign Secretary Dominic Raab will deputise for him by chairing a Cobra emergency committee on Thursday afternoon to discuss the lockdown measures with leaders of the devolved nations.
No decision is expected to be made at that meeting in Johnson's absence, with key figures dealing with the response instead discussing whether to ease or strengthen the measures ahead of an announcement next week.
But there seems little chance of the lockdown being lifted with the PM remaining in intensive care and Wednesday having witnessed a rise of 938 in the number of deaths in UK hospitals of patients who tested positive for Covid-19, the highest new total so far.
Amidst this, the Bank of England and UK Treasury on Thursday said they have agreed to temporarily extend the use of the government's Ways & Means facility.
The facility is the government's overdraft account with the BoE, enabling cash advances from the UK central bank to the government.
"As a temporary measure, this will provide a short-term source of additional liquidity to the government if needed to smooth its cashflows and support the orderly functioning of markets, through the period of disruption from Covid-19," the BoE said.
When the Debt Management Office took on the government's cash management in 2000, the need for daily use of the facility eased. However, it has remained available and has been used "on a number of occasions" since 2000. The previous high for use of the W&M account was just under GBP20 billion in 2008.
Normally, a standing balance of around GBP400 million is maintained to support Exchequer cash management. As of Wednesday, drawings under the W&M facility remained at GBP400 million, where they have done since April 2009.
Andrew Mulliner, global bonds portfolio manager at Janus Henderson Investors, commented: "We see this step as more sensational at a headline level than any significant step into the sort of monetary financing that invites comparisons to Zimbabwe. This device has been used in the past during 2008, and it is explicitly temporary in nature."
In London at midday, oil stocks remained higher ahead of the OPEC meeting later in the day, but had pared earlier gains. BP was up 0.6% while Royal Dutch Shell 'A' and 'B' shares were up 0.9% and 1.4% respectively.
Just Eat Takeaway.com was the top blue-chip performer, up 8.9%.
Takeaway.com - the Dutch arm of the merged takeaway delivery company - reported a 50% rise in first-quarter sales on increased demand for food deliveries due to the lockdown measures imposed to slow the spread of the novel coronavirus.
Dutch food delivery firm Takeaway merged with UK-based Just Eat earlier this year. However, the two businesses are being run independently as the UK Competition & Markets Authority investigates the merger. As such, the figures released Thursday only relate to Takeaway's business and do not factor in Just Eat's. They cover sales in the Netherlands, Germany and "other leading markets", the company said.
For the quarter ended March 31, Takeaway.com said orders jumped 50% to 46.7 million from 31.1 million in the first quarter of 2019.
Next was up 6.7% after Liberum resumed the clothing retailer with a Buy rating.
Another stock benefiting from a ratings upgrade was mid-cap William Hill, up 11% after RBC raised the bookmaker to Outperform from Sector Perform.
Housebuilder Redrow advanced 7.7% after saying it is eligible to receive GBP300 million support as part of the UK's Covid-19 corporate financing facility.
Redrow said the financing facility, as part of UK measures to help firms during the pandemic, is currently undrawn.
The FTSE 250 firm added that it is in negotiations for an extra GBP100 million of headroom under its revolving credit facility. This would see the facility boosted to GBP350 million from GBP250 million.
By Lucy Heming; lucyheming@alliancenews.com
Copyright 2020 Alliance News Limited. All Rights Reserved.
