Victrex Share News (VCT)

(Alliance News) - Stock prices in London opened higher on Monday following upbeat comments over the severity of the Omicron variant of Covid-19, while travel stocks rose despite tightened UK restrictions.

Top US pandemic advisor Anthony Fauci said on Sunday that while more information was needed, preliminary data on the severity of the Omicron strain are "a bit encouraging".

The FTSE 100 index was up 48.22 points, or 0.7%, at 7,170.54 early Monday. The mid-cap FTSE 250 index was up 146.40 points, or 0.7%, at 22,792.48. The AIM All-Share index was up 4.38 points, or 0.4%, at 1,186.68.

The Cboe UK 100 index was up 0.8% at 711.16. The Cboe 250 was up 0.5% at 20,205.84 and the Cboe Small Companies down 0.1% at 14,782.48.

In mainland Europe, the CAC 40 stock index in Paris was up 0.8%, while the DAX 40 in Frankfurt was up 0.7%.

In the FTSE 100, travel-related stocks were among the best performers despite tightened restrictions. InterContinental Hotels Group was up 2.1% and British Airways-parent International Consolidated Airlines Group was up 2.0%. Midcap carrier easyJet was up 1.9% and AIM-listed Jet2 up 2.9%.

The travel industry reacted with fury after it was announced all passengers arriving in the UK will have to take a Covid pre-departure test amid fears about the spread of the Omicron variant.

Ministers said it was intended to be a temporary measure following new data showing an increase in the number of cases of the new strain linked to foreign travel.

Tim Alderslade, chief executive of the industry body Airlines UK, said the rapidly changing measures meant planning was becoming impossible.

"It is premature to hit millions of passengers and industry before we see the full data. We don't have the clinical evidence," he said.

The move, which will be introduced on Tuesday, was welcomed by the opposition Labour party, which has been pressing for the return of pre-departure tests since the variant was first identified in South Africa.

"Hotel and airline stocks found some support as investors continue to assess whether the recent markdowns have been overdone, especially when looking further out to what could be a promising summer season," said interactive investor's Richard Hunter.

"However, the outlook remains immediately uncertain and the mixed economic messages, let alone the new variant, are muddying the waters. It is likely that the remaining few weeks of the year will be equally volatile as new information emerges on both," Hunter added.

At the other end of the large-cap, Rio Tinto was the worst performer, down 1.8%, after JPMorgan downgraded the Anglo-Australian miner to Neutral from Overweight.

Persimmon was down 0.8% after Barclays double downgraded the housebuilder to Underweight from Overweight.

In the FTSE 250, Clarkson was the best performer, up 5.5%. The shipping services provider said results for 2021 are anticipated to be ahead of current market expectations.

Clarkson said underlying pretax profit is now expected to be "not less than" GBP65 million. It posted underlying pretax profit of GBP44.7 million in 2020.

Victrex was up 4.5% after the speciality chemicals company said it delivered a solid and sustainable recovery during financial 2021, prompting it to declare a special dividend.

For the financial year ended September 30, Victrex posted revenue of GBP306.3 million, up 15% from GBP266.0 million last year and pretax profit of GBP92.5 million, up 46% from GBP63.5 million.

Victrex declared a full year dividend to 59.56 pence, up 29% from 46.14p paid last year. In addition, as a result of its available cash balance exceeding the GBP85 million threshold, Victrex also proposed a 50p share special dividend.

In Asia, the Japanese Nikkei 225 index closed down 0.4%. In China, the Shanghai Composite ended down 0.5%, while the Hang Seng index in Hong Kong lost 1.8%. The S&P/ASX 200 in Sydney ended up 0.1%.

The pound was quoted at USD1.3239 early Monday, up from USD1.3223 at the London equities close Friday.

The euro was priced at USD1.1288, lower from USD1.1291. Against the Japanese yen, the dollar was trading at JPY113.17, up from JPY113.06 on Friday.

Brent oil was quoted at USD71.51 a barrel Monday morning, firm from USD71.43 late Friday. Gold stood at USD1,781.25 an ounce, up from USD1,775.82.

The economic events calendar on Monday has UK construction PMI at 0930 GMT.

By Arvind Bhunjun; arvindbhunjun@alliancenews.com

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