London midday: Stocks extend gains on stimulus hopes
By Michele Maatouk
Date: Wednesday 05 Aug 2020
(Sharecast News) - London stocks had extended gains by midday on Wednesday amid expectations of further coronavirus stimulus in the US, as gold prices hit a new high.
The FTSE 100 was up 1.1% at 6,104.62.
IG analyst Chris Beauchamp said: "Even the lacklustre FTSE 100 has managed to stage a decent rally of late, and this morning's gains have been helped along by the other big story, that of gold's dizzying ascent to $2,000.
"That both equities and the supreme risk-off asset are moving higher just shows how conflicted investors are - they can't avoid being tempted by equities, but they can also read the unending stories of bankruptcies, such as Virgin Atlantic in the US this morning, and the litany of job losses, with WHSmith becoming the latest High Street firm to cut roles, and thus can see the appeal of gold.
"But then 2009/10 also saw these two asset classes gain in tandem, so we are not living in an entirely unprecedented world. Then as now the key has been the liquidity provided by central banks, while now markets also look to further government stimulus."
All eyes were on the US, as Democrats and Republicans attempt to reach a deal on further stimulus by the end of the week.
In equity markets, British Airways and Iberia parent IAG was sitting pretty at the top of the FTSE 100.
Precious metals miners Polymetal, Fresnillo and Hochschild were among the top gainers as gold prices hit $2,030 an ounce, rising above $2,000 for the first time.
Elsewhere, Hastings surged after it agreed terms on a £1.6bn takeover from a consortium led by Finnish insurer Sampo and its biggest shareholder, Rand Merchant Investment Holdings. The company also reported an increase in first-half profits as higher premium and an improved loss ratio offset the impact of claims inflation due to the pandemic.
Coca-Cola HBC was on the front foot as the bottling group reported a decline in first-half profit and revenue as it took a hit from lockdowns but said trading was beginning to recover from April lows.
On the downside, Legal & General was under pressure as the insurer left its interim dividend unchanged and reported a 73% fall in first-half profit caused by low interest rates and investment losses.
Market Movers
FTSE 100 (UKX) 6,104.62 1.14%
FTSE 250 (MCX) 17,487.40 1.04%
techMARK (TASX) 3,825.52 1.00%
FTSE 100 - Risers
International Consolidated Airlines Group SA (CDI) (IAG) 189.75p 8.18%
Evraz (EVR) 311.50p 5.52%
Coca-Cola HBC AG (CDI) (CCH) 2,134.00p 4.97%
BP (BP.) 313.75p 4.85%
Polymetal International (POLY) 2,019.00p 4.75%
Fresnillo (FRES) 1,320.50p 4.39%
Kingfisher (KGF) 260.20p 3.71%
JD Sports Fashion (JD.) 637.00p 3.41%
Antofagasta (ANTO) 1,089.50p 3.27%
Glencore (GLEN) 188.32p 3.17%
FTSE 100 - Fallers
Diageo (DGE) 2,663.50p -2.11%
HSBC Holdings (HSBA) 331.00p -1.69%
Legal & General Group (LGEN) 217.60p -1.14%
Schroders (SDR) 2,941.00p -1.01%
Informa (INF) 382.60p -0.96%
Mondi (MNDI) 1,410.50p -0.95%
NATWEST GROUP PLC ORD 100P (NWG) 112.15p -0.27%
Smith (DS) (SMDS) 270.30p -0.15%
Pennon Group (PNN) 1,063.00p -0.05%
Croda International (CRDA) 5,738.00p 0.00%
FTSE 250 - Risers
Hastings Group Holdings (HSTG) 252.60p 17.49%
Morgan Sindall Group (MGNS) 1,166.00p 12.12%
Hochschild Mining (HOC) 305.60p 10.17%
Ferrexpo (FXPO) 197.30p 8.71%
Babcock International Group (BAB) 280.70p 7.22%
Mitchells & Butlers (MAB) 165.80p 6.69%
Capita (CPI) 37.12p 6.51%
easyJet (EZJ) 587.40p 6.49%
Centamin (DI) (CEY) 224.00p 5.76%
UDG Healthcare Public Limited Company (UDG) 746.50p 5.51%
FTSE 250 - Fallers
Hammerson (HMSO) 55.62p -7.36%
Rank Group (RNK) 137.60p -3.91%
HGCapital Trust (HGT) 251.00p -3.46%
C&C Group (CCR) 226.50p -3.00%
Oxford Instruments (OXIG) 1,362.00p -2.71%
Cineworld Group (CINE) 37.64p -2.23%
Close Brothers Group (CBG) 1,096.00p -1.88%
PPHE Hotel Group Ltd (PPH) 1,060.00p -1.85%
Euromoney Institutional Investor (ERM) 797.00p -1.85%
Network International Holdings (NETW) 422.60p -1.72%
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