LONDON MARKET CLOSE: Miners weigh on FTSE 100; Shell simplifies

(Alliance News) - Stocks in London ended higher on Monday with miners restricting gains in the FTSE 100, while Royal Dutch Shell set out plans for simplification.

The FTSE 100 index closed up 3.95 points, or 0.1%, at 7,351.86. The FTSE 250 ended up 64.06 points, or 0.3%, at 23,621.58. The AIM All-Share index finished up 1.37 points, or 0.1%, at 1,254.08.

The Cboe UK 100 index ended flat at 728.00. The Cboe 250 ended up 0.4% at 21,064.40. The Cboe Small Companies ended up 0.6% at 15,661.60.

In Paris, the CAC 40 stock index ended up 0.5%, while the DAX 40 in Frankfurt ended up 0.3%.

"It's been a mixed start for the week for markets in Europe, with the FTSE 100 underperforming once again due to weakness in basic resources on account of weaker metals prices, with Anglo American, Rio Tinto, Glencore and BHP all acting as a big drag," said CMC Markets analyst Michael Hewson.

"The DAX, on the other hand has continued to edge higher making new record highs along with the CAC 40, which has outperformed," Hewson added.

Blue-chip miners Anglo American, Rio Tinto, Glencore and BHP lost 1.4%, 1.1%, 1.8% and 1.9% respectively. Industrial software provider Aveva was the worst performer, down 2.8%.

"Another big factor weighing on the FTSE today is the miners, after continued pressure from the COP26 statement, which announced a 'phasing down' of coal. Furthermore, across Europe, there has been further worry with rising Covid cases, that restrictions could come back into place even as soon as the Christmas holidays," said Spreadex.

B&M European Value Retail ended down 2.4% after both RBC and Goldman Sachs downgraded the variety story retailer.

Bucking the trend, Avast ended the best FTSE 100 stock, up 7.1%. NortonLifeLock said the waiting period under US Hart-Scott-Rodino Act expired on Friday, meaning that part of the regulatory process to acquire Avast has been satisfied. The takeover remains subject to approval from Avast shareholders at court and general meetings on Thursday. In August, the pair reached a takeover agreement.

Royal Dutch Shell 'A' and 'B' shares closed up 2.1% and 1.4% respectively after the oil major set out plans to simplify its share structure and change its name to Shell PLC.

Instead of the current 'A' and 'B' share structure, the oil major plans for a conventional single share structure. This would allow for an acceleration in distributions by way of share buybacks, reduce risk for shareholders, and let Shell manage its portfolio with greater flexibility, it said.

The company will align its tax residence to the UK. It has been incorporated in the UK with Dutch tax residence and a dual share structure since 2005.

Shell will retain its current share listings and will still be eligible for FTSE UK indices.

Further, shareholders will be asked to vote on the changes to Shell's articles of association at a general meeting on December 10.

Admiral closed up 1.9% after Berenberg upgraded the insurer to Buy from Hold.

In the FTSE 250, Cineworld Group ended the best performers, up 6.6%, after the world's second largest movie theatre chain said revenue came tantalisingly close to pre-virus levels last month, as a strong slate of releases drew filmgoers back to the cinema.

In October, group revenue amounted to 90% of 2019 levels, growing from 60% in September, 54% in August and 50% in July.

In the US, where the group owns the Regal cinema chain, October revenue was at 80% of 2019 level, up from 54% in September and 45% in each of August and July.

Cineworld's fortunes were aided by Daniel Craig's final appearance as James Bond in 'No Time To Die' which generated around GBP700 million at the box office worldwide.

CMC Markets rose 6.4% after the online trading company confirmed it was in the "very early stages" of evaluating a separation of the trading services provider between leveraged and non-leveraged divisions.

Following the launch of a business-to-business and direct-to-consumer offering announced back in June, the company has "two strong underlying" units. Leveraged products are contracts-for-difference, while non-leveraged products include shares and investment funds.

"Both businesses have benefited from significant investment and each have strong growth prospects in sizeable markets with excellent competitive positions," CMC explained.

The worst mid-cap performer was Kainos Group, down 9.3% as the information technology provider reported margin growth was "constrained".

The Belfast, Northern Ireland-based firm reported revenue growth in the six months to September 30 to GBP142.3 million, up 33% from GBP107.2 million posted a year ago. Pretax profit, meanwhile, edged up 3% to GBP24.8 million from GBP24.0 million.

Overall gross margin was 47.4% for the period, down from 52.1% a year ago.

The pound was quoted at USD1.3428 at the London equities close, up from USD1.3413 at the close Friday.

The euro stood at USD1.1420 at the European equities close, down from USD1.1450 late Friday. Against the yen, the dollar was trading at JPY113.95, up from JPY113.88.

Stocks in New York were mostly higher at the London equities close ahead of long-await talks between the US and China.

The DJIA was up 0.3% and the S&P 500 index up 0.2%, but the Nasdaq Composite was down 0.1%.

US President Joe Biden and China's Xi Jinping will speak later on Monday at a virtual summit aimed at defusing some of the tensions that have built up over Taiwan and other flashpoint issues, but with both sides signalling little appetite for compromise.

Brent oil was quoted at USD81.35 a barrel at the equities close, down sharply from USD82.26 at the close Friday.

Gold stood at USD1,860.70 an ounce at the London equities close, marginally lower against USD1,861.52 late Friday.

The economic events calendar on Tuesday has UK unemployment data at 0700 GMT, eurozone economic growth figures at 1000 GMT and US retail sales at 1330 GMT.

The UK corporate calendar on Tuesday has annual results from tobacco firm Imperial Brands and interim results from telecommunications provider Vodafone Group, property company Land Securities and home emergency cover provider Homeserve.

By Arvind Bhunjun; arvindbhunjun@alliancenews.com

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