London midday: Stocks extend gains as miners rally, pound slips
By Michele Maatouk
Date: Monday 18 Mar 2019
(Sharecast News) - London stocks had extended gains by midday on Monday, helped along by a weaker pound and a strong performance from the mining sector as Theresa May made a last-ditch attempt to garner support for her Brexit deal from Northern Ireland's DUP.
The FTSE 100 was up 0.7% at 7,277.41, trading at its best level since October, while the pound was down 0.1% against the dollar at 1.3273 and 0.4% lower versus the euro at 1.1688.
Theresa May was scrambling to get support from the DUP as expectations of another vote on her Brexit deal were tempered after Chancellor Philip Hammond suggested over the weekend that a third attempt to push the bill through the Commons could be delayed or shelved if there is not enough support from MPs.
The Prime Minister was expected to offer fresh guarantees to the DUP on the Irish backstop, along with more funding for Northern Ireland. Without their support, Tuesday's vote is unlikely to go ahead.
Meanwhile, reports indicated that Tory rebels have told May they will only support her Brexit deal if she publicly commits to standing down as prime minister.
David Cheetham, chief market analyst at XTB, said: "There's some speculation that the government will pull the vote at the last minute to avoid another humiliating defeat, with the position of the DUP seen as the likely decisive factor.
"If the DUP fail to get on board, then asking MPs to vote again appears to be a fruitless endeavour while there's also some chatter that PM May could offer to step down to secure additional support. The uncertainty is weighing on the pound which is the worst performing major currency on the day. Longer-term both the fundamental and technical outlook for the pound appear fairly constructive, but for the here and now the market is extremely sensitive to headline risk related to Brexit."
Investors were also digesting the latest survey from Rightmove, which showed annual house prices in the UK fell in March as the usual spring boost was overshadowed by Brexit uncertainty. House prices fell 0.8% on the year in March compared to a 0.2% increase in February.
On the month, growth slowed to 0.4% in March from 0.7%the month before. This marks the lowest average monthly rise at this time of year since 2011, and is considerably lower than the 0.9% average over the last seven years.
The survey found that London continued to be the main drag, with prices in the capital down 1.1% on the previous month. Outside London, prices remained more buoyant, with nine out of 11 regions seeing new-to-the-market sellers pricing higher.
Rightmove director and housing market analyst Mile Shipside said: "Buying activity remains cooler than usual, with hesitation as some buyers await a more settled political climate. There's greater resilience the further away you get from the London market, and there's a sound bedrock of demand for the right property at the right price, reinforced by ongoing housing needs combined with cheap mortgage borrowing.
"London and some of its commuter belt are suffering from a post - boom hangover, with prices now having to be far more sober to attract buyer interest. In contrast, North East prices never had the opportunity to become intoxicated by the capital city's heady mix of high demand, low interest rates and higher salaries."
In equity markets, miners were the standout gainers as copper prices rose, with Rio, BHP, Anglo American, Antofagasta and Glencore all higher. Glencore investors shrugged off reports that its offices in Mumbai have been raided by the Indian competition regulator as part of an investigation into alleged price fixing.
Shares in retailer Footasylum surged 74% as it agreed to be bought by larger rival JD Sports Fashion for 82.5p per share in cash, around half the price at which it floated in late 2017.
AstraZeneca edged up after saying that the US Food and Drug Administration has granted orphan drug designation for potential lung-disease treatment saracatinib.
Domino's Pizza gained as it refuted refuted claims made in the Sunday Times that the company has been misleading investors about progress in negotiations with the pizza chain's franchisees.
There were also gains for energy services group Hunting after an upgrade to 'buy' from 'neutral' at UBS, while Legal & General and Rolls-Royce were boosted by upgrades at JPMorgan Cazenove and Morgan Stanley, respectively.
On the downside, housebuilders fell after the release of the Rightmove survey, with Persimmon, Berkeley, Taylor Wimpey, Barratt Developments and Bovis Homes all lower.
Shares in Rightmove also declined after a downgrade to 'neutral' from 'buy' at UBS, while Aston Martin Lagonda fell as Jefferies cut its price target on the stock.
Market Movers
FTSE 100 (UKX) 7,277.41 0.68%
FTSE 250 (MCX) 19,454.64 -0.19%
techMARK (TASX) 3,546.09 0.06%
FTSE 100 - Risers
British American Tobacco (BATS) 3,153.25p 2.39%
Anglo American (AAL) 1,979.00p 2.06%
Standard Chartered (STAN) 622.30p 2.02%
BHP Group (BHP) 1,751.60p 1.92%
Royal Bank of Scotland Group (RBS) 273.90p 1.90%
Rio Tinto (RIO) 4,229.00p 1.88%
Smurfit Kappa Group (SKG) 2,216.00p 1.74%
WPP (WPP) 865.80p 1.62%
Lloyds Banking Group (LLOY) 65.86p 1.57%
Sainsbury (J) (SBRY) 227.32p 1.57%
FTSE 100 - Fallers
Auto Trader Group (AUTO) 497.60p -1.39%
Rightmove (RMV) 494.10p -1.30%
Persimmon (PSN) 2,265.16p -1.26%
Berkeley Group Holdings (The) (BKG) 3,936.00p -1.13%
Whitbread (WTB) 5,058.00p -1.10%
Taylor Wimpey (TW.) 181.80p -1.06%
Hiscox Limited (DI) (HSX) 1,597.00p -1.05%
Admiral Group (ADM) 2,165.00p -1.01%
Paddy Power Betfair (PPB) 5,890.00p -0.93%
Barratt Developments (BDEV) 608.00p -0.82%
FTSE 250 - Risers
Hunting (HTG) 577.50p 5.48%
Acacia Mining (ACA) 205.30p 4.06%
Hochschild Mining (HOC) 197.25p 3.43%
Domino's Pizza Group (DOM) 238.50p 3.34%
Ferrexpo (FXPO) 270.04p 3.03%
BlackRock Smaller Companies Trust (BRSC) 1,430.00p 2.88%
AJ Bell (AJB) 306.95p 2.56%
Kaz Minerals (KAZ) 630.40p 2.17%
Centamin (DI) (CEY) 92.89p 1.90%
Fidelity China Special Situations (FCSS) 235.22p 1.83%
FTSE 250 - Fallers
Aston Martin Lagonda Global Holdings (AML) 1,106.80p -4.68%
Senior (SNR) 210.80p -4.09%
Clarkson (CKN) 2,505.00p -4.02%
Indivior (INDV) 107.20p -3.68%
Bakkavor Group (BAKK) 125.50p -3.46%
Contour Global (GLO) 177.90p -3.05%
Hilton Food Group (HFG) 910.00p -2.57%
Pets at Home Group (PETS) 156.50p -2.37%
Galliford Try (GFRD) 754.00p -2.33%
CLS Holdings (CLI) 244.00p -2.20%
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