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(Alliance News) - Stock prices in London opened mixed on Wednesday amid concerns over the Omicron variant and government measures to contain it, while investors digested disappointing UK economic growth figures.
UK Prime Minister Boris Johnson on Tuesday gave the go-ahead for people's Christmas plans, although he warned tougher restrictions could be implemented post-December 25.
Johnson said "continuing uncertainty" about the severity of the Omicron variant and hospital admission rates means he does not believe there is enough evidence at the moment to justify stricter measures.
But the situation remains "finely balanced" and people should "exercise caution", Johnson added.
The FTSE 100 index was down 21.58 points, or 0.2%, at 7,275.83 early Wednesday. But the mid-cap FTSE 250 index was up 27.30 points, or 0.1%, at 22,847.60, and the AIM All-Share index was up marginally at 1,174.62.
The Cboe UK 100 index was down 0.2% at 722.37. The Cboe 250 was up 0.2% at 20,252.10, and the Cboe Small Companies was up 0.1% at 14,839.54.
In mainland Europe, the CAC 40 stock index in Paris was up 0.1%, while the DAX 40 in Frankfurt was 0.2% higher.
In Asia on Wednesday, the Nikkei 225 index in Tokyo closed up 0.2%. In China, the Shanghai Composite closed down 0.1%, and the Hang Seng index in Hong Kong ended up 0.6%. The S&P/ASX 200 in Sydney closed up 0.1%.
In the FTSE 100, Taylor Wimpey rose 0.3% after the UK Competition & Markets Authority ended its probe into the housebuilder over ground rents.
Taylor Wimpey said the CMA investigation into the historical sale of leasehold properties with doubling ground rent clauses by the company is closed, following the agreement of voluntary undertakings.
The housebuilder said the cost of the undertakings falls within the original provision Taylor Wimpey made in 2017. By entering into the undertakings there is no finding that Taylor Wimpey has infringed UK consumer law, it noted.
Conversely, Croda International was down 0.9%. The speciality chemicals company has agreed to sell the majority of its Performance Technologies and Industrial Chemicals businesses to Cargill for an enterprise value of EUR915 million on a cash-free, debt-free basis.
Croda said the disposal of the businesses follows the strategic review that it announced in May. The operations being sold represent 77% of PTIC's 2020 revenue and consist of five manufacturing facilities in the UK, China and the Netherlands.
Land Securities was down 0.1%. The property developer Land Securities bought a further stake in the Bluewater shopping mall outside London.
Landsec said it has completed the acquisition of an additional 25% share in Bluewater from Lendlease Retail Partnership for GBP172 million, representing a net initial yield of 8.15% and an equivalent yield of 8.25%.
In a separate deal, Landsec said it will sell 25% of this share - a 7.5% stake - to co-owner M&G for its pro rata share of the purchase price with the deal completing in April 2022. After this, Landsec's ownership of Bluewater will be 48.8%.
In the FTSE 250, Syncona was the best performer, up 8.5%, after the healthcare investor said its portfolio company Gyroscope Therapeutics will be sold to Swiss pharmaceutical company Novartis for up to USD1.5 billion.
Syncona has a 54% stake in Gyroscope following a USD42 million investment in March, after co-founding the business in 2016.
Novartis shares were down 0.3% in Zurich.
Pennon was down 0.3% after the CMA said the utility has until December 31 to give undertakings for its Bristol Water acquisition.
The regulator said the Pennon acquisition of Bristol Water may impede Ofwat's ability to make comparisons between water companies.
In response, Pennon said it intends to provide undertakings to CMA for Bristol Water by December 31.
The pound was quoted at USD1.3253 early Wednesday, up from USD1.3248 at the London equities close Tuesday, despite disappointing UK economic growth figures.
UK economic growth was revised lower in the third quarter on a quarterly basis but higher on an annual basis, figures from the Office for National Statistics showed.
On the quarter before, UK gross domestic product advanced by 1.1% in the three months to September, slower than a 5.4% rise in the three months to July, but missed consensus of an expansion of 1.3%, which would have matched the first estimate.
On a year before, the UK economy grew by 6.8% in the third quarter, slowing sharply from the 24% annual growth rate in the second quarter. The latest reading slightly beat the market forecast, cited by FXStreet, of 6.6% annual growth, which also would have matched the first estimate.
Analysts at Capital Economics said: "The downward revision to GDP in Q3 means the economy had a little less momentum going into the closing months of the year than we previously thought. And given early signs that the huge surge in Covid-19 infections has weighed on activity so far in December, GDP growth looks to have slowed in Q4.
"But these data are old news and predate the recent surge in virus infections caused by the Omicron variant. That already seems to have prompted a weakening of activity in December. And, although the economy has got better at coping with restrictions with each new wave, the possibility of tighter restrictions in January is further darkening the outlook for GDP."
The euro was priced at USD1.1270, firm from USD1.1267. Against the Japanese yen, the dollar was trading at JPY114.30, rising from JPY114.14.
Brent oil was quoted at USD74.14 a barrel on Wednesday morning, up from USD73.48 late Tuesday. Gold stood at USD1,786.23 an ounce, firm from USD1,785.40.
Wednesday's economic calendar has US GDP at 1330 GMT.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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