London midday: Chinese trade data boosts equities

UK equities rose on Wednesday after data showed China’s trade surplus unexpectedly widened on higher exports in December.

China’s trade surplus grew to 382.05bn yuan in December from 343.10bn yuan in November, beating analysts’ forecasts of 338.80bn yuan.

Exports rose by 2.3% in December following a 3.7% dip a month earlier. Economists had pencilled in a 4.1% drop.

Imports declined 4% last month, compared to analysts’ estimates for a 7.9% fall and November’s 5.6% slide.

“China’s trade data for December support our view that, despite the turmoil in Chinese financial markets, there has not been a major deterioration in its economy in recent months,” according to Capital Economics.

“Meanwhile, another large trade surplus last month provides a cushion for the People’s Bank in the face of soaring capital outflows.”

The People’s Bank of China fixed the yuan at 6.5630 to the dollar on Wednesday, marking the fourth day that the central bank has kept its yuan guidance roughly stable.

The yuan traded at 6.5752 to the dollar in the offshore market, slightly stronger than 6.5770 late Tuesday.

Meanwhile, oil prices recovered from Tuesday’s declines. At 12130 GMT, Brent crude rose 2.4% to $31.62 per barrel and West Texas Intermediate increased 2.6% to $31.26 per barrel.

In the Eurozone, industrial production rose 1.1% in November from a year ago, following a 2% increase in October. Analysts had predicted a 1.3% gain.

Still to come, Federal Reserve policymaker Eric Rosengren speaks in Iowa at 1730 GMT and the central bank publishes its Beige Book at 1900 GMT.

In company news, oil producers rallied on the uptick in crude prices. BP, Royal Dutch Shell and Tullow Oil were among the risers.

Premier Oil’s shares were suspended from trading on Wednesday morning pending the announcement of a potential acquisition of assets which may be classed as a reverse takeover under the Financial Conduct Authority listing rules.

J Sainsbury declined after reporting a 0.4% drop in like-for-like retail sales over the festive third quarter. However it was less than the 0.7% forecast, leading the grocer to say that the second half as a whole is likely to be better than the first.

Sports Direct advanced after it snapped up an 11.5% stake in Umbro and Lee Cooper-owner Iconix Brand Group and 2.3% of US retailing giant Dick's Sporting Goods. The group last week warned on profits amid widespread criticism about the treatment of its staff.

Ted Baker jumped after saying sales rose 10% over the eight week Christmas period against a tough trading backdrop and said full year earnings to be in line with expectations.

Galliford Try was a high riser after the construction group pointed to solid trading across the board in the first half, as its order book rose in an improving market.

Market Movers

FTSE 100 (UKX) 5,987.94 0.99%
FTSE 250 (MCX) 16,767.88 0.48%
techMARK (TASX) 3,175.16 0.74%

FTSE 100 - Risers

Sports Direct International (SPD) 429.30p 4.20%
Rio Tinto (RIO) 1,713.50p 3.72%
Tesco (TSCO) 160.75p 3.58%
Babcock International Group (BAB) 986.50p 3.35%
Glencore (GLEN) 74.41p 3.35%
Shire Plc (SHP) 4,245.00p 3.18%
BP (BP.) 333.20p 3.13%
Royal Dutch Shell 'B' (RDSB) 1,388.00p 2.89%
Royal Dutch Shell 'A' (RDSA) 1,389.00p 2.81%
Capita (CPI) 1,197.00p 2.66%

FTSE 100 - Fallers

Merlin Entertainments (MERL) 435.20p -1.47%
Sky (SKY) 1,088.00p -1.36%
Lloyds Banking Group (LLOY) 68.50p -1.15%
Sainsbury (J) (SBRY) 248.80p -0.96%
London Stock Exchange Group (LSE) 2,566.00p -0.70%
Next (NXT) 6,730.00p -0.59%
Taylor Wimpey (TW.) 197.80p -0.55%
ITV (ITV) 267.90p -0.48%
Bunzl (BNZL) 1,840.00p -0.43%
National Grid (NG.) 945.40p -0.38%

FTSE 250 - Risers

Tullow Oil (TLW) 134.20p 9.02%
Home Retail Group (HOME) 149.00p 5.00%
TalkTalk Telecom Group (TALK) 198.50p 4.75%
Ted Baker (TED) 2,826.00p 4.67%
JD Sports Fashion (JD.) 1,059.00p 3.93%
Amec Foster Wheeler (AMFW) 381.90p 3.89%
Just Eat (JE.) 474.50p 3.76%
G4S (GFS) 224.00p 3.70%
Weir Group (WEIR) 881.50p 3.46%
Electrocomponents (ECM) 231.30p 3.44%

FTSE 250 - Fallers

Dunelm Group (DNLM) 865.50p -4.36%
Jimmy Choo (CHOO) 130.20p -3.56%
Allied Minds (ALM) 348.00p -2.93%
Laird (LRD) 344.30p -2.60%
Virgin Money Holdings (UK) (VM.) 332.00p -2.47%
Mitie Group (MTO) 294.20p -2.26%
Enterprise Inns (ETI) 101.20p -2.03%
Go-Ahead Group (GOG) 2,526.00p -1.98%
Aldermore Group (ALD) 209.70p -1.92%
Thomas Cook Group (TCG) 119.60p -1.73%