London midday: Stocks gain as investors eye EU summit; Homeserve rallies

London stocks had risen a little further by midday on Friday as investors eyed an EU summit in Brussels to discuss a coronavirus rescue fund.

The FTSE 100 was up 0.5% at 6,283.29 .

Neil Wilson, chief market analyst at Markets.com, said: "Whilst the EU seems to be edging closer to a deal and Merkel and Macron should ultimately get the consensus they need for something like a €500bn-€750bn package of support, there is a risk the market has put too much on this particular meeting and is left disappointed if there is no final decision taken this weekend.

"We may get an agreement in principle on the fund that will be made up of a mix of grants and loans, with details on the total money value and attached reform requirements to be finessed. Even that might be a stretch though - Merkel warned this week that it could take until the end of the summer to achieve a deal and today said talks would be tough. Dutch PM Rutte said this morning he’s ‘not optimistic’ ahead of the talks. Indeed, I would not expect much more than a political declaration affirming member states commitment to achieving some kind of a deal."

Market participants were also mulling the latest results from Netflix, whose shares fell overnight after second-quarter earnings per share missed expectations but revenue beat. In addition, the streaming giant’s subscriber growth guidance for the third quarter failed to impress.

Despite the positive tone in markets, worries about the coronavirus outbreak continued to weigh on sentiment after US cases rose by 75,000 in 24 hours, marking a fresh daily record.

Russ Mould, investment director at AJ Bell, said: "It’s a continuation of the push-pull factors influencing stocks. On one hand there is ongoing nervousness about the pandemic and localised flare-ups. On the other hand, there is the hope of more stimulus measures until there is firm evidence that the pandemic is under control and economies are getting back on track."

In equity markets, Homeserve rose sharply after saying it expected a solid performance in the current financial year as the home repair company indicated trading was picking up well after Covid-19 lockdowns.

Iron ore miner Rio Tinto was up after it reported a 1.5% rise in second-quarter iron ore shipments and said demand from China was improving as the country’s economy recovers from the pandemic.

Essentra ticked higher after saying it has reached a settlement with the US Department of Justice and will pay a $666,543 cash penalty related to unauthorised transactions dating back to 2018 by two employees of its subsidiary, Essentra FZE, and linked to North Korea.

Asset manager Ninety One was higher as it said assets under management rose to £118bn as at 30 June from £103.4bn at the end of March.

Renishaw surged after the engineer lifted its full-year revenue expectations but downgraded its expectations for statutory pre-tax profit.

On the downside, British Airways and Iberia owner IAG was weaker after BA announced late on Thursday that it was retiring all of its Boeing 747s as the travel industry takes a hit from the pandemic.

Sales, marketing and support services group DCC was a little lower as it said trading in the first quarter was better than it expected but down on the year before because of Covid-19 lockdown restrictions.

Market Movers

FTSE 100 (UKX) 6,283.29 0.52%
FTSE 250 (MCX) 17,343.41 0.13%
techMARK (TASX) 3,805.50 1.16%

FTSE 100 - Risers

Homeserve (HSV) 1,355.00p 3.99%
Avast (AVST) 592.50p 3.04%
Burberry Group (BRBY) 1,474.00p 2.68%
SSE (SSE) 1,430.50p 2.40%
AstraZeneca (AZN) 9,052.00p 2.35%
Intermediate Capital Group (ICP) 1,396.00p 2.27%
Ocado Group (OCDO) 2,172.00p 2.21%
National Grid (NG.) 894.80p 1.98%
BAE Systems (BA.) 486.50p 1.93%
Antofagasta (ANTO) 1,031.00p 1.88%

FTSE 100 - Fallers

Barclays (BARC) 116.16p -2.04%
Kingfisher (KGF) 225.40p -1.49%
Melrose Industries (MRO) 116.15p -1.36%
ITV (ITV) 67.60p -1.31%
HSBC Holdings (HSBA) 380.95p -1.21%
WPP (WPP) 617.40p -1.09%
Evraz (EVR) 305.20p -1.07%
3i Group (III) 858.20p -1.01%
Berkeley Group Holdings (The) (BKG) 4,421.00p -1.01%
International Consolidated Airlines Group SA (CDI) (IAG) 222.00p -0.94%

FTSE 250 - Risers

Aston Martin Lagonda Global Holdings (AML) 57.90p 12.54%
Renishaw (RSW) 4,734.00p 6.86%
Spirent Communications (SPT) 264.00p 3.94%
Assura (AGR) 77.60p 3.88%
Oxford Instruments (OXIG) 1,354.00p 3.83%
RHI Magnesita N.V. (DI) (RHIM) 2,572.00p 3.71%
FirstGroup (FGP) 33.60p 3.58%
Games Workshop Group (GAW) 8,825.00p 3.46%
Capita (CPI) 38.79p 3.38%
Sirius Real Estate Ltd. (SRE) 80.70p 3.20%

FTSE 250 - Fallers

TI Fluid Systems (TIFS) 176.80p -5.76%
TBC Bank Group (TBCG) 790.00p -4.24%
Bank of Georgia Group (BGEO) 923.00p -4.15%
Carnival (CCL) 1,003.00p -4.02%
Euromoney Institutional Investor (ERM) 819.00p -3.65%
Dixons Carphone (DC.) 78.65p -3.50%
Micro Focus International (MCRO) 297.00p -2.88%
Hays (HAS) 121.70p -2.64%
Pagegroup (PAGE) 371.00p -2.37%
4Imprint Group (FOUR) 2,285.00p -2.35%