LONDON MARKET OPEN: Insurers Climb After Strong Showing From Beazley

(Alliance News) - Stock prices in London were narrowly mixed early on Friday but European indices inched higher, with the result of the race for the White House looking more certain, as the scale tipped further toward Democrat challenger Joe Biden.

"Joe Biden is close to winning the presidency with a combination of the key states of Georgia (16 Electoral College votes), North Carolina (15), Nevada (6), Arizona (11), and Pennsylvania (20) that would carry him over the 270-vote mark needed," said AxiCorp analyst Stephen Innes.

"Fading uncertainty around the outcome is supporting equity markets and driving USD weakness."

The FTSE 100 index of London large-cap stocks was down 5.74 points, or 0.1% at 5,900.44. The FTSE 250 rose 110.46 points, or 0.6%, at 18,038.99. The AIM All-Share was down 0.61 of a point, or 0.1%, at 978.36.

The Cboe UK 100 index was up marginally at 586.56. The Cboe 250 was up 0.5% at 15,235.63. The Cboe Small Companies rose 0.1% at 15,235.63.

The CAC 40 stock index in Paris rose 0.2% in early trade on Friday, and Frankfurt's DAX 30 was up 0.2%.

The dollar was lower across the board early Friday. The pound was quoted at USD1.3148 early Friday, up from USD1.3097 on Thursday evening. The euro was up at USD1.1843, from USD1.1820. The dollar also was down against the yen, at JPY103.48 from JPY103.71 late Thursday in London.

In the FTSE 100, insurers were among the better performers early Friday. Aviva rose 3.9%, M&G climbed and Prudential were both 1.9% higher. The trio benefited from a positive read across from mid-cap peer Beazley, which itself rose 1.2%.

Beazley posted a rise in gross premiums written after its third quarter of trading. In the nine months ended September 30, gross written premiums surged 16% year-on-year to USD2.53 billion. Beazley said it has seen growth in almost all of its divisions.

Looking ahead, Beazley said Covid-19 related claims may climb by USD50 million should there not be a return to "some form of normality" in the second half of 2021. Back in September, it said its claims estimate for Covid-19 was USD340 million net of reinsurance, which it kept in place on Thursday. Beazley said it expects third-quarter catastrophe claims to be USD80 million net of reinsurance.

Fellow insurer RSA lost 1.3%, one of the FTSE 100's worst performers, giving back a bit of the stock's jump just before Thursday's close.

RSA backed a GBP7.2 billion takeover proposal from a two-headed consortium.

The company on Thursday confirmed Canadian insurer Intact Financial and Scandinavian insurer Tryg have made a proposal to buy the FTSE 100-listed firm and divide it up between them.

The proposal, RSA said, comprises 685 pence in cash per RSA share, plus payment by RSA of the announced interim dividend of eight pence per share. RSA shares were priced at 661.40p early Friday.

It had closed at 670.00p on Thursday, jumping in the final minutes of trading from its quote of 452.60p just 10 minutes prior to the close.

Back among London mid-caps, marine services firm James Fisher & Sons shed 12%. During the third quarter of 2020, the company said it "did not see the improvement to trading conditions".

James Fisher was waiting for a "seasonal uplift" during the period and due to it not being forthcoming, revenue for the nine months ended September was down 17% year-on-year.

"Due in large part to Covid-19 restrictions, especially in the UK, the Middle East and southern Africa, revenue in Marine Support continued to be impacted by project delays and cancellations in subsea projects in both Renewables and Oil & Gas. In response a further restructuring programme has been implemented in Marine Support and the carrying value of the asset base is under review," the company said.

For the full-year, it now expected underlying operating profit, before separately disclosed items, to be in the range of GBP35 million and GBP40 million. This would be down as much as 47% from GBP66.3 million in underlying operating profit in 2019.

Elsewhere in London, RWS Holdings rose 3.1%, after German bank Berenberg resumed coverage of the language support services firm with a Buy recommendation.

On Wednesday, RWS completed its all-share combination with peer SDL.

In the data calendar Friday, the highlight of the day will be the US nonfarm payroll figures at 1330 GMT.

The ADP jobs report on Wednesday, a precursor, showed US private sector companies added jobs at a slower pace than expected in October.

Brent oil fetched USD40.48 early Friday, down from USD40.87 at the London equities close on Thursday.

Gold prices were slightly higher early Friday. The precious metal was quoted at USD1,947.12, down from USD1,946.20.

By Eric Cunha; ericcunha@alliancenews.com

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