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(Alliance News) - Stock prices in London were easing from morning highs at midday on Tuesday as investors become more mindful of the spread of the Delta variant of Covid-19, while US banks were higher in New York on dividend optimism ahead of the second-quarter earnings season.
The FTSE 100 index was up 10.64 points, or 0.2%, at 7,083.61. The mid-cap FTSE 250 index was up 30.30 points, or 0.1%, at 22,563.72. The AIM All-Share index was up 4.44 points, or 0.4%, at 1,255.68.
The Cboe UK 100 index was up 0.1% at 704.80. The Cboe 250 was flat at 20,211.73, and the Cboe Small Companies was down 0.3% at 15,331.10.
In Paris, the CAC 40 was up 0.3%, while Frankfurt's DAX 30 was outperforming, up 0.8%.
Analysts at ActivTrades commented: "European shares are trading slightly higher on Tuesday, despite an Asian trading session controlled by bear traders amid uncertain market sentiment. Investors are digesting the latest evolution of the Delta variant, which is increasingly seen as a growing threat to the ongoing economic recovery in many areas.
"Even if the economic impact is unlikely to be significant in countries like Canada, the UK, the US and western Europe, which have benefited from an efficient vaccine rollout, the inconsistency in vaccination campaigns in other parts of the world is likely to lead to an uneven recovery."
In the FTSE 100 housebuilders were in the green, reacting positively to price data from Nationwide. UK house prices continued to surge in June with the highest rate of annual growth since November 2004, figures from the mortgage lender showed.
Taylor Wimpey was up 0.9%, Persimmon up 1.6%, Barratt Developments up 0.8% and Berkeley Group up 0.3%.
On an annual basis, the Nationwide house price index jumped 13% in June, accelerating from 11% growth in May. The reading missed the market estimate, cited by FXStreet, of 14% growth. On a monthly basis, house prices rose 0.4% in June, slowing from 1.7% in May. The monthly print missed the market forecast of 0.7%. The average UK house price stood at GBP245,432 in June, up from GBP242,832 in May.
The housing market continued to benefit from borrowing costs at near record lows and the UK government's stamp duty holiday on purchases.
In other sector news, Barratt Developments said it has appointed Mike Scott as an executive director and chief financial officer. The date he will join Barratt is currently being finalised.
Scott currently is CFO of smaller peer Countryside Properties, which noted the announcement, saying it was commencing a search for Scott's successor and will confirm his leaving date in due course. Countryside was up 0.5%.
At the other end of the FTSE 100, precious metal miners Polymetal International and Fresnillo were the worst performers, down 2.0% and 1.7% respectively. They were tracking spot gold prices lower, trading at USD1,770.50 an ounce, down from USD1,779.56.
United Utilities was down 1.2%, after Morgan Stanley downgraded the water company to Underweight from Equal Weight. Peer Severn Trent was up 0.5% after Morgan Stanley upgraded the stock to overweight from equal weight.
In the FTSE 250, IWG shares were up 1.8%, giving back a bigger earlier gain, after CC Capital Partners said it does not intend to make a takeover offer for the office space provider. The announcement came in response to a Sky News story late Monday that said IWG has held secret talks with the New York-based private equity firm over a GBP4 billion buyout.
Conversely, fellow midcap UDG Healthcare said it has agreed to be bought by Clayton Dubilier & Rice, after the US private equity firm returned to the table with an improved takeover offer.
UDG Healthcare said it has agreed final terms with CD&R on an offer that values the Dublin-based private healthcare provider at GBP2.76 billion.
Under the deal terms, UDG shareholders will be entitled to receive 1,080 pence for each share, up 5.6% from the previous offer of 1,023p per share. UDG shares were up 0.5% at 1,071.00p.
UDG said CD&R has the support of 11% of shareholders, including Allianz Global Investors and Kabouter Management, for the final offer. Other institutional shareholders of UDG also have indicated their willingness to vote in favour of the deal. UDG directors unanimously recommended the acquisition to shareholders.
Elsewhere, Atlantic Investments Holdings, trading as Bridgepoint, outlined its plans to forge ahead with a London initial public offering.
The private equity firm - which was spun out of NatWest in 2000 - is looking to float at least a quarter of its shares to raise around GBP300 million from the IPO to fund growth plans, boost cash in its own funds, and pay down debts.
On admission, the middle market private assets investor will be valued around GBP2 billion.
The dollar was higher against major counterparts. The pound was quoted at USD1.3843 at midday on Tuesday, down from USD1.3884 at the London equities close Monday.
The euro was priced at USD1.1901, down from USD1.1932. Against the yen, the dollar was trading at JPY110.62, up from JPY110.53.
Brent oil quoted at USD74.50 a barrel on Tuesday at midday, lower against USD75.32 late Monday in London.
The fall in oil prices come amid expectations that OPEC and other major producers will decide to lift output at their meeting on Thursday.
US stock market index futures were pointed mostly lower after the S&P 500 and Nasdaq Composite indices pushed up to finish at fresh highs on Monday.
The Dow Jones Industrial Average was called up 0.2%, but the S&P 500 and the Nasdaq Composite were called down 0.1% and 0.3% respectively.
On Monday, Facebook's market value breached the USD1 trillion mark for the first time after a US judge dismissed an antitrust action against the social media platform filed last year by federal and state regulators. The lawsuit, filed late last year, sought to unwind Facebook's acquisitions of Instagram and WhatsApp.
Facebook closed up 4.2% on Monday and was up 0.2% in pre-market trade on Tuesday.
US banks are likely to be in focus after JPMorgan Chase, Morgan Stanley and Goldman Sachs on Monday said they plan to raise their quarterly payouts, following the results of the Federal Reserve's latest stress tests.
Morgan Stanley will double its quarterly payouts to USD0.70 per share from USD0.35, from the third quarter of the year. It also upped its share buyback programme to USD12 billion through to June 30 of next year.
JPMorgan, also effective from the third quarter, will raise its payout by 11% to USD1.00 from USD0.90. Goldman Sachs plans to raise its dividend to USD2.00 per share from USD1.25.
In pre-market trade in New York on Tuesday, JPMorgan was up 0.1%, Morgan Stanley up 3.1% and Goldman Sachs up 1.2%.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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