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(Alliance News) - The FTSE 100 gained just shy of 90 points in early trade on Tuesday, with housebuilders on the up following a buoyant update from mid-cap peer Crest Nicholson, and packaging firm DS Smith also an early riser as it reaffirmed it will pay an interim dividend.
Away from individual stocks, attention will turn to the US, where campaigning has ended and polls have opened, as a divisive presidential election campaign draws to a close.
"Joe Biden has been leading in the national polls by a comfortable seven points for some time now, although the race is tighter in some key swing states, which will decide the election," noted Gain Capital's Fiona Cincotta.
"Should Joe Biden manage to win the race, a blue wave, which includes control of the Senate is needed for the markets to really get excited about stimulus. A Republican controlled Senate indicates more gridlock to come, and the markets will need to drastically scale back stimulus expectations."
In London, the FTSE 100 index was up 88.24 points, or 1.6% at 5,743.19. The FTSE 250 surged 247.71 points, or 1.4%, at 17,428.13. The AIM All-Share was up 9.01 points, 1.0%, at 955.99.
The Cboe UK 100 was up 1.5% at 570.89. The Cboe 250 was up 1.7% at 14,677.30. The Cboe Small Companies was up 0.3% at 9,463.93.
The CAC 40 stock index in Paris gained 1.2% in early trade Tuesday, and Frankfurt's DAX 30 rose 1.0%.
On the London Stock Exchange, housebuilders led the way among blue-chips. Taylor Wimpey was up 4.8%, while Barratt Developments and Persimmon both climbed 3.4%.
The trio benefited from a positive read-across from mid-cap peer Crest Nicholson, which itself jumped 19%, the best performer in the FTSE 250.
Crest Nicholson said adjusted pretax profit for the year ended October 31 will be "significantly ahead" of consensus of GBP37.9 million.
The firm guided for it to come in at the upper end of its previous GBP35 million to GBP45 million forecast range as the trading environment has been "positive" since the UK housing sector re-emerged from the Spring virus shutdown. Forward sales as of October 31 totalled 2,289 units with gross development value of GBP480.5 million.
Crest also said it will reinstate its dividend, effective from its financial 2021 interim results, on a two and a half times cover basis.
Back in the FTSE 100, DS Smith was up 2.3%. The packaging firm said "it remains our intention to declare a dividend" after its performance improved as the six months ended October 31 drew to a close.
"While the profit for the half year will be lower than the comparable prior year period due to Covid, we have seen significant improvement in Q2 compared to Q1, on both sides of the Atlantic," DS Smith explained.
Corrugated box volumes returned to comparable annual growth in the second quarter, with half-year volumes expected to be around 1.5% lower from a year before.
Peer Mondi was up 2.2% in early dealings, with Smurfit Kappa rising 2.1%.
Only a handful of the FTSE 100 were in the red early Tuesday, though one of those was Primark owner Associated British Foods, losing 1.6%.
AB Foods posted an annual earnings fall and also decided not to pay a final dividend, after previously also having opted against an interim payout.
"The increasing restrictions in a number of Primark's major markets, lead us to be cautious. On balance, we have elected not to propose a final dividend for the year whilst we monitor the impact of further Covid-19 restrictions on Primark during this important trading season," AB Foods explained.
It paid a 46.35 pence dividend in financial 2019.
AB Foods said group revenue fell 12% in the year ended September 12 to GBP13.94 billion from USD15.82 billion. Revenue was below market consensus of GBP14.40 billion. Pretax profit plunged 42% to GBP686 million from GBP1.17 billion during a year hit by Covid-19 lockdowns.
Primark revenue alone was 24% lower at GBP5.90 billion, AB Foods noted, adding that UK like-for-like sales are 12% lower since reopening from the Spring Covid-19 lockdown.
Faring better, Grocery revenue was 0.9% higher, and the Agriculture arm saw a 0.7% rise. However, Sugar revenue was down 0.9%, and Ingredients revenue inched 0.1% lower.
"Notwithstanding the currently announced periods of restriction, we expect Primark full year sales and profit to be higher next year. There will be a sales decline in the first half compared to last year but higher sales in the second half," AB Foods guided.
Thread manufacturer Coats Group rose 14% in the FTSE 250. It said adjusted operating profit for 2020 will top market expectations and will be in the range of USD100 million and USD110 million.
Between July 1 and October 31, sales fell 9% year-on-year at constant currency, narrowing from a first half slump of 21%. Reported sales were down 11% after a 24% plunge in the first half.
"Improving demand" has been seen in the Apparel & Footwear and Performance Materials segments, Coats noted.
On a potential shareholder payout, Coats commented: "The board is mindful of the importance of income to shareholders and as performance continues to progress, it will keep future dividends, including the final 2020 dividend, under review".
In forex, the US dollar was heading downwards.
The pound was quoted at USD1.2960 early Tuesday, up from USD1.2894 at the London equities close on Monday.
Against the dollar, the euro rose to USD1.1683 early Tuesday from USD1.1630 at the European equities close on Monday.
Versus the Japanese yen, the dollar dropped to JPY104.59 from JPY104.84.
Gold was quoted at USD1.894.77 early Tuesday in London, up from USD1,891.20 late Monday.
A barrel Brent oil fetched USD39.70 early Tuesday in London, up from USD37.94 late Monday.
Oil majors on the London Stock Exchange were higher. BP's stock was up 2.7%, Royal Dutch Shell's 'A' shares climbed 2.1% and the 'B' shares 2.3%.
Saudi Aramco released its third-quarter results on Tuesday, with numbers showing a profit fall.
Chief Executive Officer Amin Nasser insisted the company saw "early signs of a recovery in the third quarter".
Net income fell 45% year-on-year to USD11.79 billion and earnings before interest and tax were down 42% to USD25.46 billion. Saudi Aramco said the average realised crude price dropped 30% to USD43.6 a barrel.
Saudi Aramco was up 0.4% on the Tadawul in Riyadh.
By Eric Cunha; ericcunha@alliancenews.com;
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