London close: Stocks finish positive as China data boosts sentiment
By Josh White
Date: Tuesday 31 Mar 2020
(Sharecast News) - London stocks managed to recover some lost ground and close in the green on Tuesday, with sentiment underpinned by encouraging Chinese manufacturing figures.
The FTSE 100 ended the session up 1.95% at 5,671.96, and the FTSE 250 was 3.26% firmer at 15,101.13.
Sterling was stronger against both of its major trading pairs, rising 0.3% on the dollar to last trade at $1.2451, and gaining 0.61% on the euro to €1.1305.
Data released earlier showed that China's manufacturing sector rebounded in March.
The official manufacturing purchasing managers' index rose to 52.0 from a record low of 35.7 in February, comfortably beating expectations for a reading of 44.8.
It was also above the 50.0 mark that separates contraction from expansion.
The non-manufacturing PMI increased to 52.3 from 29.6 in February, beating expectations for a reading of 42.0.
"China provided Western investors with a light at the end of the tunnel on Tuesday, showing it is possible to return to growth after the worst (hopefully) of the coronavirus crisis," said Spreadex analyst Connor Campbell.
Neil Wilson, chief market analyst at Markets.com, was a little more sceptical about the manufacturing PMI.
"Two things about this number - it shows a bounce, which is encouraging, but it doesn't show a massive bounce into the 60s, and can we really trust the number?
"Economic recovery will be uneven, and stock markets are unlikely to bounce back to where they were, yet the panic seems to be over," he said.
Closer to home, UK growth stagnated in the final quarter of 2019, putting the economy in a weak position as the coronavirus crisis loomed, official figures showed.
The economy registered zero growth in the three months to the end of December, the Office for National Statistics said, confirming its earlier estimate.
The result tallied with economists' expectations.
Its annual growth rate was 1.1% in the fourth quarter - the lowest since the first quarter of 2018.
Household consumption registered no growth and business investment fell, while government spending ahead of Brexit helped stop activity from declining.
Consumer confidence, meanwhile, had weakened since the outbreak of Covid-19, and was predicted to worsen still as the full impact of lockdown hits home.
GfK's Overall Consumer Confidence Index for March decreased to -9 from -7.
Within that, the personal finance situation over the last 12 months increased 3 points, to +2 , and the score for the general economic situation over the last year remained unchanged at -23.
But forward-looking subindices, like those tracking the personal financial and general economic situation, fell by 3 points to +3 and 6 points to -27, respectively.
In equities, the Covid-19 updates kept on rolling in as companies tried to make sense of the economic picture.
Imperial Brands surged 12.29% after saying the outbreak had no material effect on its trading so far, as the cigarette and vaping company unveiled a new €3.5bn revolving credit facility with its lenders.
Manufacturing group Melrose Industries also racked up gains, rising 4.57% after a tumble on Monday, when it issued a profit warning late in the day and said it was pulling its final dividend amid a "significant deterioration" in end markets due to the coronavirus pandemic.
Flutter Entertainment rallied 9.86% as the UK competition regulator approved its acquisition of Canada's Stars Group after finding the combination will not lead to a worse deal for online gamblers.
Royal Dutch Shell was in the green by 7.75% even after it forecast first-quarter writedowns of up to $800m as oil prices crashed in the face of a demand slump due to the coronavirus pandemic.
Advertising company WPP rose 6.28% as it pulled its guidance and suspended its dividend and share buyback due to the pandemic.
Smiths Group advanced 9.91% even after it delayed the demerger of its medical business and scrapped its half-year dividend as the engineering group reported intensifying disruption from the coronavirus crisis.
Specialist products manufacturer Morgan Advanced Materials reversed earlier gains, closing down 1.53% after suspending its dividend and withdrawing its 2020 guidance due to the virus outbreak.
Market Movers
FTSE 100 (UKX) 5,671.96 1.95%
FTSE 250 (MCX) 15,101.13 3.26%
techMARK (TASX) 3,326.75 2.24%
FTSE 100 - Risers
Imperial Brands (IMB) 1,496.80p 12.29%
Smiths Group (SMIN) 1,218.50p 9.91%
Flutter Entertainment (FLTR) 7,288.00p 9.86%
Ashtead Group (AHT) 1,765.50p 8.11%
Carnival (CCL) 981.40p 7.94%
Meggitt (MGGT) 290.30p 7.92%
Royal Dutch Shell 'B' (RDSB) 1,359.80p 7.75%
Royal Dutch Shell 'A' (RDSA) 1,419.00p 7.08%
WPP (WPP) 551.40p 6.90%
BP (BP.) 344.20p 6.37%
FTSE 100 - Fallers
Fresnillo (FRES) 660.80p -4.74%
United Utilities Group (UU.) 902.80p -4.71%
Lloyds Banking Group (LLOY) 32.00p -4.48%
M&G (MNG) 112.60p -4.17%
Experian (EXPN) 2,251.00p -4.13%
Royal Bank of Scotland Group (RBS) 112.90p -3.83%
Pennon Group (PNN) 1,069.50p -3.34%
Morrison (Wm) Supermarkets (MRW) 178.00p -2.41%
Severn Trent (SVT) 2,280.00p -2.19%
Standard Chartered (STAN) 445.80p -2.13%
FTSE 250 - Risers
Hammerson (HMSO) 77.38p 16.12%
Trainline (TRN) 340.00p 13.33%
Senior (SNR) 70.25p 13.12%
Sirius Real Estate Ltd. (SRE) 65.90p 12.84%
Marston's (MARS) 41.24p 12.31%
GVC Holdings (GVC) 561.00p 12.20%
VinaCapital Vietnam Opportunity Fund Ltd. (VOF) 262.50p 11.76%
BlackRock Smaller Companies Trust (BRSC) 1,118.00p 11.55%
National Express Group (NEX) 205.80p 11.12%
Dixons Carphone (DC.) 78.08p 11.00%
FTSE 250 - Fallers
Aston Martin Lagonda Global Holdings (AML) 198.30p -12.30%
McCarthy & Stone (MCS) 64.75p -8.87%
Centamin (DI) (CEY) 121.60p -6.43%
Crest Nicholson Holdings (CRST) 175.50p -4.72%
Avon Rubber (AVON) 2,375.00p -3.96%
Just Group (JUST) 53.90p -3.92%
Redrow (RDW) 359.50p -3.75%
Cairn Energy (CNE) 77.40p -3.43%
CLS Holdings (CLI) 196.20p -3.41%
Rotork (ROR) 215.10p -3.37%
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