London close: Benchmark manages green finish after choppy afternoon
London stocks finished just above the waterline after some turbulent late trading on Tuesday, as investors breathed a sigh of relief after EU leaders agreed on a Covid-19 rescue package.
The FTSE 100 ended the session up 0.13% at 6,269.73, and the FTSE 250 was 0.67% firmer at 17,501.83.
Sterling was trading stronger, last rising 0.55% against the dollar to $1.2731, and advancing 0.16% on the euro to €1.1079.
“The confirmation that a compromise was reached came through in the early hours of today, and that helped stocks get off to a flying start this morning,” said CMC Markets analyst David Madden.
“The €750bn fund will be divided into €390bn of grants and €360bn of loans, and keep in mind the initial proposal was for €500bn in grants and €250bn in loans.”
Madden noted that stocks were off their earlier highs, likely because traders felt that some sort of a compromise was always going to be achieved in the end.
“Besides, the EU is not known to move quickly, so the funds might not be deployed for months.”
On home shores, the latest figures from the Office for National Statistics showed the government borrowed £35.5bn in June as it looked to counter the economic fallout from the coronavirus pandemic, around five times more than last June and taking total government debt to a record £1.98trn.
Still, it was lower than May’s £45.5bn and below consensus expectations of £38bn.
“The smaller rise in public sector borrowing in June compared to May suggests that government support is starting to wind down as the economy reopens,” said economists at Capital Economics.
“However, government borrowing is still exceptionally high and we suspect that a slowdown in the recovery and further rise in unemployment later this year will prompt the government to announce additional fiscal spending at the next Budget.”
In equity markets, British Airways and Iberia parent IAG was up 2.94% following heavy losses in the previous session, while defence firm Babcock advanced 6.87% after an upgrade to ‘overweight’ at Barclays.
Trainline shares surged 11.07% after the company said it has appointed Photobox chief executive Jody Ford to the newly-created role of chief operating officer, with effect from 21 September.
On the downside, miner BHP Group was in the red by 2.61% as it reported a 7% rise in fourth-quarter iron ore output, but warned the resurgence of coronavirus outbreaks threatened the short-term demand outlook for its main commodities.
GVC Holdings was 7.34% lower after the gambling firm said British tax authorities were now investigating an unidentified part of the group after widening a probe into payment processing for online betting in Turkey.
Capital & Counties was 1.94% weaker after it said the value of its Covent Garden estate has fallen by 17% as the pandemic took its toll on the company’s tenants, many of whom were forced to close their doors in March.
Market Movers
FTSE 100 (UKX) 6,269.73 0.13%
FTSE 250 (MCX) 17,501.83 0.67%
techMARK (TASX) 3,846.01 -0.32%
FTSE 100 - Risers
Hargreaves Lansdown (HL.) 1,735.50p 10.13%
Rolls-Royce Holdings (RR.) 285.60p 7.85%
BP (BP.) 315.95p 4.21%
Whitbread (WTB) 2,365.00p 3.73%
Compass Group (CPG) 1,154.00p 3.54%
Melrose Industries (MRO) 120.45p 3.17%
WPP (WPP) 614.20p 2.95%
International Consolidated Airlines Group SA (CDI) (IAG) 217.20p 2.94%
Royal Dutch Shell 'A' (RDSA) 1,307.00p 2.92%
Royal Dutch Shell 'B' (RDSB) 1,249.60p 2.78%
FTSE 100 - Fallers
GVC Holdings (GVC) 770.00p -11.70%
Persimmon (PSN) 2,527.00p -3.33%
Avast (AVST) 577.50p -3.27%
AstraZeneca (AZN) 9,048.00p -2.92%
BHP Group (BHP) 1,750.40p -2.61%
Fresnillo (FRES) 1,069.00p -2.55%
Rio Tinto (RIO) 4,845.00p -2.31%
Barratt Developments (BDEV) 535.20p -2.23%
Johnson Matthey (JMAT) 2,280.00p -1.70%
Experian (EXPN) 2,804.00p -1.58%
FTSE 250 - Risers
Trainline (TRN) 443.60p 11.07%
SSP Group (SSPG) 254.00p 8.92%
Pagegroup (PAGE) 394.60p 6.88%
Babcock International Group (BAB) 304.90p 6.87%
Energean (ENOG) 595.00p 6.82%
Petrofac Ltd. (PFC) 174.30p 6.28%
TUI AG Reg Shs (DI) (TUI) 371.40p 6.08%
Wetherspoon (J.D.) (JDW) 962.00p 6.05%
Mitchells & Butlers (MAB) 165.60p 6.04%
Network International Holdings (NETW) 494.80p 5.41%
FTSE 250 - Fallers
Spirent Communications (SPT) 253.00p -6.27%
Future (FUTR) 1,326.00p -3.77%
Balfour Beatty (BBY) 252.40p -3.66%
Go-Ahead Group (GOG) 680.00p -3.55%
Fisher (James) & Sons (FSJ) 1,242.00p -3.42%
Morgan Advanced Materials (MGAM) 225.50p -3.01%
easyJet (EZJ) 621.00p -2.88%
Just Group (JUST) 45.50p -2.88%
Polypipe Group (PLP) 428.00p -2.61%
Syncona Limited NPV (SYNC) 245.00p -2.58%