LONDON MARKET OPEN: FTSE 100 boosted as pound falls further

(Alliance News) - Stock prices in London opened higher on Friday ahead of the US jobs report in the afternoon, with the internationally exposed FTSE 100 aided by sterling weakness.

The UK flagship index was up 32.51 points, or 0.5%, at 7,157.57. The mid-cap FTSE 250 index was up 70.34 points, or 0.3%, at 22,692.13. The AIM All-Share index was up 2.10 points, or 0.2%, at 1,261.81.

The Cboe UK 100 index was up 0.3% at 710.50. The Cboe 250 was up 0.3% at 20,392.73, and the Cboe Small Companies was down 0.4% at 15,348.10.

The FTSE 100 was outperforming similar measures in Europe. In Paris, the CAC 40 was up 0.1%, while Frankfurt's DAX 30 up 0.3%.

Sterling slipped after Bank of England Governor Andrew Bailey on Thursday said recent consumer price pressures should prove temporary.

"In the UK, a short-term boost was handed to the FTSE 100 following some sterling weakness. The tone was also lifted by some dovish comments from the governor of the Bank of England, echoing the Federal Reserve's view that inflation is likely to rise from here before falling away once more in a temporary spike," said interactive investor's Richard Hunter.

The pound was quoted at USD1.3751 early Friday, down from USD1.3775 at the London equities close Thursday and declining further from the GBP1.39 mark reached at the start of the week.

The euro stood at USD1.1827, lower from USD1.1851. Against the yen, the dollar was quoted at JPY111.60, flat from JPY111.59.

In the FTSE 100, Informa was the best performer, up 2.5%, after Berenberg raised the events and publishing company to Buy from Hold.

Barratt Developments was up 2.2% after Jefferies upgraded the housebuilder to Buy from Hold.

In the FTSE 250, Bellway was the best performer, up 2.6% after Jefferies raised the Newcastle-based housebuilder to Buy from Hold.

Wizz Air was up 0.7% after the Eastern Europe-focused airline said passenger numbers rebounded to 1.6 million in June, triple what it carried a year before. Its June load factor was 64%, up from 52% a year ago. Last month, the budget carrier opened its sixth Italian base, in Naples.

Midcap peers easyJet and Tui were up 0.8% and 0.6% respectively

Ryanair Holdings was up 1.1% after the Irish budget airline reported a rebound in passenger traffic, as travel restrictions were eased last month.

The Dublin-based budget airline said it flew 5.3 million passengers in June, up sharply from 1.8 million in May, 1.0 million in April, and just 400,000 in June 2020. Ryanair operated over 38,000 flights in June with a 72% load factor.

Last month, Ryanair added seats to destinations such as Malta and the Balearic Islands following their addition to the UK's travel green list, but urged the government to relax travel rules further.

In Asia, the Japanese Nikkei 225 index closed up 0.3% on Friday. In China, the Shanghai Composite finished down 1.9%. The Hang Seng index in Hong Kong was down 1.9%, reopening after being closed on Thursday for a holiday. The S&P/ASX 200 in Sydney ended up 0.6%.

Brent oil was quoted at USD75.64 a barrel on Friday morning, up from USD75.52 at the London equities close Thursday. Gold was quoted at USD1,775.45 an ounce, higher against USD1,769.16 late Thursday.

Major oil-producing countries on Thursday failed to agree to boost output in August to meet growing demand and limit recent price rises, adjourning their meeting to Friday.

The 13 members of OPEC and 10 allies were expected to make a decision to continue to moderately increase output beyond July.

The OPEC+ grouping cut crude production after the pandemic sent oil prices crashing last year. But the group has slightly increased production since early May. Oil prices have recovered, this week reaching levels last seen in October 2018. OPEC members led by Saudi Arabia conferred Thursday via a teleconference.

But a subsequent technical meeting of OPEC members together with their 10 allies led by Russia failed to reach consensus, leading to discussions being postponed until Friday, according to an OPEC statement.

The economic calendar on Friday also has eurozone producer prices at 1000 BST.

By Arvind Bhunjun; arvindbhunjun@alliancenews.com

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