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London open: Stocks and sterling rise despite political uncertainty

By Michele Maatouk

Date: Friday 16 Nov 2018

London open: Stocks and sterling rise despite political uncertainty

(Sharecast News) - London stocks rose in early trade on Friday, taking their cue from an upbeat session on Wall Street as investors continued to keep a close eye on Brexit developments.
At 0825 GMT, the FTSE 100 was up 0.6% to 7,083.26, while the pound was 0.4% higher against the dollar at 1.2825 and 0.1% firmer versus the euro at 1.1286, having suffered its worst day on Thursday since the October 2016 'flash crash' in the wake of a number of key cabinet resignations.

Brexit was firmly in focus again amid reports that Environment Secretary and staunch Leaver Michael Gove had turned down the role of Brexit Secretary and is considering quitting cabinet over the Brexit deal.

Meanwhile, political uncertainty was set to continue after hardline Brexiteer Jacob Rees-Mogg submitted a letter of no-confidence in Theresa May as leader of the Tory Party, amid rumours that the number of letters submitted by Tory MPs to the 1922 Committee was nearing the 48 needed to trigger a vote of no confidence.

"If the 48 letter threshold is reached for a vote to be called then the matter will then probably go to a vote in the next few days, which would require Mrs May's opponents to get 159 MPs to vote against her in order to force her to step down," said CMC Markets analyst Michael Hewson.

"Even if the Prime Minister were to win the vote it would need to be by a very wide margin for her not to be politically damaged in some way. In any case any new leader will face the very same problems that the current incumbent is now facing, which means that for all the sound and fury that is currently buffeting currency markets the ultimate calculus remains the same in that there is no majority in the House of Commons for a 'no deal' Brexit which means that MPs will try and coalesce around some form of alternative, assuming a general election can be avoided."

Ignoring the political uneasiness, the Footsie followed Wall Street higher, with US investors emboldened by positive indications about a trade talks between the US and China to break a five-day losing streak overnight,

"This is still very fragile so we are not sure if this will last," said analyst Naeem Aslam at Think Markets. He noted that bargain hunters were jumping back in the tech sector, which led to a boost for the likes of Micro Focus, which was top of the leaderboard.

A rally in oil prices was also a key element lifting the UK benchmark, with heavyweights BP and Shell carried higher as Brent crude jumped 1.6% to $67.71 a barrel.

In other corporate news, cigarette maker Imperial Brands was in the green after saying it was developing a version of electronic cigarettes that could be locked to prevent possible underage use, after a fresh US regulatory crackdown on vaping. The announcement from FTSE 100-listed Imperial came a day after the US Food and Drug Administration announced new restrictions on flavoured e-cigs.

Safety and health technology group Halma gained as it announced the acquisition of radar surveillance and safety solutions provider Navtech Radar for £21m on a cash- and debt-free basis, funded from Halma's existing facilities.

Kier rallied as the construction company expressed confidence about meeting its 2019 full year expectations and said that its order books and development pipelines remain strong.

Gold miner Centamin shone after an upgrade to 'overweight' at Morgan Stanley, while outsourcer Capita bounced back from heavy losses earlier in the week, when it came under fire for an NHS cervical cancer screening blunder.

Going the other way, AstraZeneca was the standout loser as it said that a phase 3 trial of its Imfinzi drug showed that it was no better than chemotherapy in treating patients with non-small cell lung cancer that has spread to other organs.

Shire was a touch weaker even as the biopharmaceutical group said that a phase 3 trial of its lanadelumab drug showed that it significantly reduced the number of attacks of hereditary angioedema in patients treated with 300 mg every two weeks.

Market Movers

FTSE 100 (UKX) 7,083.26 0.64%
FTSE 250 (MCX) 18,725.11 0.34%
techMARK (TASX) 3,402.63 0.29%

FTSE 100 - Risers

Micro Focus International (MCRO) 1,444.50p 2.41%
Legal & General Group (LGEN) 253.20p 2.01%
Coca-Cola HBC AG (CDI) (CCH) 2,403.00p 1.99%
Smith (DS) (SMDS) 358.30p 1.99%
Rio Tinto (RIO) 3,875.50p 1.97%
Smurfit Kappa Group (SKG) 2,296.00p 1.86%
Halma (HLMA) 1,333.00p 1.83%
3i Group (III) 803.33p 1.71%
Antofagasta (ANTO) 809.40p 1.68%
GVC Holdings (GVC) 790.00p 1.67%

FTSE 100 - Fallers

AstraZeneca (AZN) 6,152.00p -2.61%
Fresnillo (FRES) 838.00p -1.41%
National Grid (NG.) 833.40p -0.80%
Vodafone Group (VOD) 155.13p -0.18%
British American Tobacco (BATS) 2,771.00p -0.14%
Morrison (Wm) Supermarkets (MRW) 243.80p -0.12%
Paddy Power Betfair (PPB) 6,950.00p 0.00%
Schroders (SDR) 2,529.00p 0.00%
Bunzl (BNZL) 2,301.00p 0.00%
St James's Place (STJ) 1,025.50p 0.00%

FTSE 250 - Risers

Capita (CPI) 111.10p 3.45%
QinetiQ Group (QQ.) 280.00p 3.40%
Kier Group (KIE) 847.93p 2.78%
Premier Oil (PMO) 87.20p 2.29%
Cairn Energy (CNE) 198.80p 2.16%
IWG (IWG) 240.30p 2.08%
IMI (IMI) 958.50p 2.08%
Intermediate Capital Group (ICP) 969.00p 1.95%
Tullow Oil (TLW) 199.50p 1.71%
Kaz Minerals (KAZ) 520.20p 1.64%

FTSE 250 - Fallers

John Laing Group (JLG) 310.60p -2.82%
Just Group (JUST) 84.75p -2.64%
Fisher (James) & Sons (FSJ) 1,706.00p -1.95%
Shaftesbury (SHB) 880.25p -1.59%
CYBG (CYBG) 258.91p -1.55%
Bodycote (BOY) 748.50p -1.32%
EI Group (EIG) 173.78p -1.15%
Charter Court Financial Services Group (CCFS) 274.99p -1.08%
Electrocomponents (ECM) 614.63p -1.06%
Temple Bar Inv Trust (TMPL) 1,198.60p -0.94%

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