LONDON MARKET MIDDAY: Stocks up as UK hospitality reopening confirmed

(Alliance News) - Stock prices in London remained sharply higher at midday on Tuesday after the long Easter weekend, as investors look ahead to an easing of coronavirus restrictions in England next week.

The FTSE 100 was up 75.04 points, or 1.1%, at 6,812.34. The mid-cap FTSE 250 index was up 221.35 points or 1.0%, at 21,954.10. The AIM All-Share index was up 0.7% at 1,217.38.

The Cboe UK 100 index was up 1.2% at 679.43. The Cboe 250 was up 1.1% at 19,634.30. The Cboe Small Companies was up 0.9% at 14,062.75.

In mainland Europe, the CAC 40 in Paris and the DAX 30 in Frankfurt were up 0.6% and 1.0% respectively.

"The FTSE is putting in an impressive performance, trading 1% higher, boosted by a double whammy of good news. Not only did strong overnight China data boost commodity prices, lifting heavyweight miners, but British Prime Minister Boris Johnson also confirmed shops, hairdressers, and outside hospitality in the UK will re-open next Monday," said analysts at Oanda.

Among FTSE 100 miners, Rio Tinto was up 3.5%, BHP was up 3.2% and Antofagasta was up 3.1%.

China's services sector posted stronger growth in March, with hiring also picking up and optimism surging to its highest level in over 10 years.

The Caixin headline seasonally adjusted business activity index posted 54.3 points in March, improved from 51.5 in February. It was further above the 50.0 no-change mark, suggesting growth quickened in March.

BP was up 3.1% after the oil major hit its USD35 billion net debt target during the first quarter of 2021, due to the early delivery of disposal proceeds and a positive operating performance, paving the way for share buybacks.

BP had previously guided that it would get its debt down to USD35 billion by the end of 2021. It had said net debt actually was expected to increase during the first half, due to severance payments, a payment to Norway's Equinor for the completion of their US offshore wind joint venture, and BP's annual USD1.2 billion Gulf of Mexico oil spill redress payment.

On reaching this net debt target, BP said it is committed to returning at least 60% of surplus cash flow to shareholders by way of share buybacks, for which it announce further details at its first quarter results on April 27.

At the other end of the large-caps, Ocado and Just Eat Takeaway, which have benefited from lockdown restrictions, were down 1.2% and 1.0% respectively after UK Prime Minister Boris Johnson on Monday confirmed non-essential stores, restaurants, hairdressers and pub beer gardens will reopen from April 12 in England.

Johnson said he plans to stick "like glue" to his plan for easing restrictions despite scientific advisers warning it could create a wave of Covid infections akin to that seen during spring last year.

Pub operators JD Wetherspoon and Marston's were up 1.2% and 0.9% respectively. Shopping centre operator Hammerson was best mid-cap performer, up 7.4%.

AstraZeneca was down 0.7% after a top official in the European Medicines Agency said in an interview published Tuesday that there is a link between the AstraZeneca coronavirus vaccine and blood clots.

EMA head of vaccines Marco Cavaleri told Italy's Il Messaggero newspaper that "in my opinion, we can say it now, it is clear there is a link with the vaccine", although it was not clear what caused such a reaction.

At the other end of the FTSE 250, Homeserve was down 2.5% after the home emergency cover provider said adjusted pretax profit for the 2021 financial year increased in line with consensus expectations, while its UK customer base shrank.

Adjusted pretax profit for the financial year that ended March 31 is expected to be around GBP191 million, up 5.5% from GBP181.0 million the previous year, HomeServe said. The home repairs company reported 6.8% organic customer growth in North America, to 4.7 million from 4.4 million. However, its number of UK customers fell 11% to 1.6 million from 1.8 million.

Elsewhere, Credit Suisse shares were up 1.4% in Zurich. The Swiss bank warned of a sizeable first quarter loss and said two key members of its key team will depart the bank, in the wake of a US-based hedge fund defaulting on a margin call and the collapse of supply chain finance firm Greensill Capital.

Brian Chin, the chief executive of CS's investment banking arm, will depart on April 30. Chief Risk & Compliance Officer Lara Warner stepped down from the Credit Suisse executive board effective Tuesday. Further, Credit Suisse said two investigations will be carried out by "external parties". One probe will be centred on the hedge fund matter and another on its supply chain finance funds.

Meanwhile, the dollar was lower against major counterparts. The pound was quoted at USD1.3840 at midday on Tuesday, firm from USD1.3830 at the London equities close Thursday, though easing from an intraday high of USD1.3920.

The euro was priced at USD1.1804, up from USD1.1765 late Thursday. Against the yen, the dollar was trading at JPY110.50, lower from JPY110.60.

The eurozone's unemployment rate stood at 8.3% in February, unchanged from in January, the latest figures from Eurostat showed.

Brent oil was quoted at USD62.65 a barrel on Tuesday at midday, down from USD63.63 late Thursday in London. Gold was trading at USD1,735.55 an ounce, higher against USD1,728.70.

US stock market futures were pointed to a lower open. The Dow Jones and S&P 500 indices set new record highs on Monday, after data on Friday last week showed far more US jobs than expected were created in March, reinforcing the view of a strong recovery.

The Dow Jones Industrial Average was called down 0.2%, the S&P 500 down 0.4% and Nasdaq Composite down 0.3%.

By Arvind Bhunjun; arvindbhunjun@alliancenews.com

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