London midday: Stocks gain after Yellen's dovish remarks

London stocks were in positive territory on Wednesday after dovish remarks from Federal Reserve Chair Janet Yellen.

Yellen on Tuesday said the central bank should proceed with caution on raising interest rates amid looming global risks to the US economy, including low oil prices and a slowdown in China.

Speaking at the Economic Club of New York, she said the Fed will monitor a number of factors in its policy decision such as the pace of global growth, inflation, the strength of the dollar and commodities.

“Her speech was taken as notably dovish, cancelling out some of the ‘April hike’ calls from the previous week, with the usual reaction of a falling US dollar and surging equities seen yesterday evening,” said IG senior market analyst Chris Beauchamp.

“The good feeling has carried over into Europe, and it may well be that the period of consolidation and modest declines has come to an end. If the move in oil and equities can be sustained, there is a good chance that bulls will run with this theme far into April and beyond, and perhaps we’ll also start.”

Oil prices recovered from declines in the previous session with Brent crude rising 1.2% to $39.63 per barrel and West Texas Intermediate increasing 1.5% to $38.89 per barrel at 1128 BST.

In economic data, the European Commission revealed economic sentiment in the Eurozone fell for the third month in a row in March. The EC’s economic sentiment index slipped to 103.0 points from 103.9 in February and 105.0 in January. Economists had expected a reading of 103.8.

“As consumer confidence remains at its lowest level since December 2014, many observers will conclude that Mario Draghi’s latest pack of stimulus measures is yet to do the trick,” said Dennis de Jong, managing director at UFX.com.

Still to come, the US will see the private payrolls report from ADP at 1415 BST which will be closely scrutinised ahead of the all-important non-farm payrolls on Friday.

Weekly US crude oil inventory data from the Department of Energy is also due at 1630 BST.

On the corporate front, mining stocks reversed declines from the prior day with Anglo American, BHP Billiton and Glencore among the biggest risers.

William Hill was under the cosh after Morgan Stanley downgraded the stock to ‘underweight’ from 'equalweight’ and cut the target price to 290p from 425p following the group’s profit warning last week.

Premier Foods rallied after US spice giant McCormick increased its offer for the company from 60p to 65 per share, valuing the Mr Kipling to Oxo Cubes group at £1.5bn.

BBA Aviation gained after selling six fix-based operations for $190m in cash to affiliates of KSL Capital Partners as agreed with the US Department of Justice under the terms of the regulatory approval for the acquisition of Landmark Aviation.

Market Movers

FTSE 100 (UKX) 6,215.05 1.79%
FTSE 250 (MCX) 16,990.47 1.40%
techMARK (TASX) 3,135.51 1.34%

FTSE 100 - Risers

Anglo American (AAL) 527.10p 10.02%
Standard Chartered (STAN) 472.00p 7.41%
Glencore (GLEN) 154.10p 7.16%
BHP Billiton (BLT) 802.50p 7.00%
Rio Tinto (RIO) 1,984.50p 6.52%
Antofagasta (ANTO) 475.70p 4.78%
BP (BP.) 359.00p 3.82%
Royal Dutch Shell 'A' (RDSA) 1,712.00p 3.76%
Fresnillo (FRES) 946.50p 3.50%
Royal Dutch Shell 'B' (RDSB) 1,720.00p 3.15%

FTSE 100 - Fallers

Worldpay Group (WI) (WPG) 273.50p -0.62%
London Stock Exchange Group (LSE) 2,821.00p -0.42%
easyJet (EZJ) 1,520.00p -0.33%
Babcock International Group (BAB) 946.00p -0.26%
Persimmon (PSN) 2,103.00p -0.10%
SABMiller (SAB) 4,246.50p -0.08%
Berkeley Group Holdings (The) (BKG) 3,265.00p -0.06%
Merlin Entertainments (MERL) 456.40p -0.02%
Next (NXT) 5,635.00p 0.00%
Informa (INF) 696.00p 0.07%

FTSE 250 - Risers

Aberdeen Asset Management (ADN) 273.50p 6.59%
Petrofac Ltd. (PFC) 925.50p 6.38%
Evraz (EVR) 87.50p 5.93%
Kaz Minerals (KAZ) 167.20p 5.82%
Allied Minds (ALM) 485.70p 5.79%
Ashmore Group (ASHM) 293.10p 5.55%
Sports Direct International (SPD) 383.10p 5.25%
Amec Foster Wheeler (AMFW) 450.80p 5.13%
Wood Group (John) (WG.) 625.50p 5.13%
Weir Group (WEIR) 1,125.00p 4.75%

FTSE 250 - Fallers

William Hill (WMH) 329.40p -1.58%
Dunelm Group (DNLM) 913.00p -1.46%
NMC Health (NMC) 1,044.00p -1.23%
Daejan Holdings (DJAN) 5,660.00p -1.22%
Aldermore Group (ALD) 217.40p -1.18%
Ted Baker (TED) 2,773.00p -1.11%
Lancashire Holdings Limited (LRE) 538.50p -1.01%
Caledonia Investments (CLDN) 2,261.00p -0.83%
Riverstone Energy Limited (RSE) 813.50p -0.79%
Domino's Pizza Group (DOM) 1,012.00p -0.69%