LONDON MARKET CLOSE: FTSE Leaps As Pound Slumps After UK Services Data

LONDON (Alliance News) - The FTSE 100 surged on Tuesday with annual results from oil major BP and online grocer Ocado contributing to the rally.Meanwhile, also boosting the overseas earnings-heavy FTSE 100 was a weaker pound, which slumped below the USD1.30 mark after concerning data from the UK services sector.The FTSE 100 index closed up 143.24 points, or 2.0%, at 7,177.37. The FTSE 250 closed up 147.21 points, or 0.8%, at 18,996.02, and the AIM All-Share closed up 2.93 points, or 0.3%, at 925.14.The Cboe UK 100 ended up 2.1% at 12,182.55, the Cboe UK 250 closed up 0.5% at 16,918.25, and the Cboe Small Companies ended down 0.1% at 11,229.65."The FTSE had a lot going for it on Tuesday. Solid results from BP, a battered sub USD1.30 pound and a strong start on Wall Street; a positive concoction that helped lift the FTSE comfortably over 7150 to a 3-month high," commented Fiona Cincotta, senior market analyst at City Index.The pound was quoted at USD1.2936 at the London equities close Tuesday, compared to USD1.3059 at the close on Monday.The latest IHS Markit/CIPS Purchasing Managers' Index came in at 50.1 in January, down from 51.2 in December and only marginally above the no-change mark of 50. A score above 50 indicates expansion in the sector and one below signals contraction. The latest reading was the worst score in two-and-a-half years, and the second weakest since December 2012.Capital Economics said the slowdown that started in the fourth quarter of 2018 appears to have worsened at the start of 2019."Worries about future demand now appear to be seeping into hiring decisions, which may start to weigh on employment growth. However, if a Brexit deal is agreed, there should be a substantial amount of pent up demand ready to give GDP growth a boost," said Thomas Pugh, UK economist at Capital Economics. Meanwhile, the latest services PMI for the eurozone came in at 51.2 in January, unchanged from December. The composite index edged down to 51.0 form 51.1.The euro stood at USD1.1407 at the European equities close Tuesday, against USD1.1431 at the same time on Monday.In European equities on Tuesday, the CAC 40 in Paris ended up 1.7%, while the DAX 30 in Frankfurt ended 1.7% higher.Stocks in New York were higher at the London equities close, with the DJIA up 0.6%, the S&P 500 index up 0.3%, and the Nasdaq Composite up 0.6%. Focus in the US lies on President Donald Trump's State of the Union speech in the evening, where he is expected to spend time addressing immigration and his proposed expansion of the wall on the border with Mexico during his State of the Union speech on Tuesday night.It remains unclear if Trump will use the address to declare a national emergency at the border, an action he has hinted at taking. The president is increasingly frustrated with Congress, where his rivals, the Democratic Party, are blocking funding for the barrier he campaigned on in 2016.Entertainment giant Walt Disney Co is expected to release its earning after the closing bell on Wall Street.Coming after peer Royal Dutch Shell's strong annual results last week, oil major BP gained 5.2% in London as its own full-year earnings came in ahead of consensus forecasts.Underlying replacement cost profit came in at USD12.72 billion, up from USD6.17 billion in 2017. Market consensus had seen a figure of USD11.88 billion. Fourth quarter underlying RC profit was USD3.48 billion, up from USD2.11 billion the same period a year before. Expectations had been for underlying RC profit of USD2.63 billion. Operating cash flow for the full year, excluding payments related to the 2010 Gulf of Mexico oil spill, was USD26.1 billion, up from USD24.1 billion in 2017.Brent oil was quoted at USD62.22 a barrel at the London equities close Tuesday, unchanged from USD62.24 late Monday.In other commodities, gold was quoted at USD1,314.60 an ounce at the London equities close Tuesday, flat against USD1,314.20 at the close on Monday.Back in the FTSE 100, Ocado closed up 4.2% despite having traded as much as 3% lower in early dealings after reporting a widened annual loss. The online grocer's loss for the year to December 2 widened to GBP44.4 million from GBP8.3 million the year prior.The loss was significantly wider than analyst expectations, which had forecast Ocado's loss at GBP30.0 million. Distribution costs rose to GBP485.4 million in the year from GBP434.2 million, while administrative expenses also jumped to GBP167.0 million from GBP117.7 million.Separately, Ocado said a fire broke out at its customer fulfilment centre in Andover, south west England, causing damage to some of the equipment in the online grocer's automated warehouse.Some orders had already left the facility and will be delivered as planned. However, others will not be completed as operations at the centre have been suspended. Sales, marketing and support services firm DCC rose 2.7% after it said operating profit in the third quarter of its current financial year was "significantly" ahead of the prior year, despite milder winter weather conditions. The FTSE 100 constituent benefited from a first-time contribution from prior acquisitions of gas companies Retail West, TEGA, and Shell Hong Kong & Macau.Looking ahead, DCC expects annual operating profit to be "significantly" ahead of the prior year and in line with current market consensus expectations.Wm Morrison Supermarkets shares finished 2.3% higher after the supermarket chain was raised to Buy from Hold by Berenberg.Also on Tuesday, research agency Kantar Worldpanel published its latest market share data which showed that "Veganuary" beat "Dry January" in UK grocery sales.UK grocery sales in the 12 weeks to January 27 were up 1.7% on the prior year. Total till roll sales, however, fell by GBP1.5 billion as consumers kept a "watchful eye" on spending after a record December. The UK's biggest supermarket by market share, Tesco, was the fastest growing among the big four, with sales up 1.0%. Its market share however, shed 0.2 of a percentage point to 27.7%.Morrisons sales rose 0.4% with its market share down to 10.6% from 10.8%.Meanwhile, Sainsbury's was the only UK supermarket to experience a reduction in sales during the period, down 0.3%, while its market share dropped by 0.4 percentage point to 15.9%.Tesco shares closed up 1.9% and Sainsbury's up 1.5%.Shares in property investor SEGRO closed down 0.9% after Societe Generale cut the stock to Hold from Buy.In the FTSE 250, pharmaceutical firm Indivior closed down 9.1% after a court in the US rejected the drugmaker's motion for a rehearing of its case against Dr Reddy's Laboratories.Dr Reddy's has been developing a generic buprenorphine/naloxone treatment, based on Indivior's Suboxone, with Indivior trying to halt development in court.Indivior had appealed against the removal of an injunction against Dr Reddy's plans, but this has been rejected by the US Court of Appeals for the Federal Circuit. Indivior plans on filing an emergency motion with the court while an appeal in Delaware goes on, with Delaware having decided Dr Reddy's has not infringed Indivior's patent. Indivior believes that if Dr Reddy's launches its generic product, it will lose up to 80% of its market share "within a matter of months". Elsewhere on the LSE, Carpetright shares fell 6.1% after the floorings retailer said Chief Financial Officer Neil Page will retire from the company at the end of the current financial year.Page, who has been with the flooring retailer for over ten years, will step down on February 25 but will continue to work with the business until the end of the firm's financial year on April 30. Meanwhile, the company said trading was in line with its expectations, despite reporting negative UK like-for-like sales, against a backdrop of "uncertainty and weak consumer confidence". In the UK corporate calendar on Wednesday are interim results from housebuilders Barratt Developments and Redrow, while lender CYBG and water firm Severn Trent put out trading statements. Later, at 1200 GMT, are annual results from pharmaceuticals giant GlaxoSmithKline.In the economic calendar on Wednesday are German factory orders at 0700 GMT followed by the US trade balance at 1330 GMT.