London midday: Stocks gain as oil prices rally, Greece announces reforms

UK equities advanced on Monday as oil prices jumped and Greece made positive progress with reforms.

Oil prices rose after data showed China’s crude imports jumped 7.6% in April compared to a year ago. It marked the third consecutive month that crude imports exceeded 40 million tonnes.

At 1136 BST Brent crude increased 1.47% to $46.06 per barrel and West Texas Intermediate gained 1.9% to $45.56 per barrel.

In a boost to the eurozone, Greece’s parliament on early Monday passed a package of pension and tax reforms to appease the country’s lenders to unlock further bailout cash.

Greece’s measures will aim to attain savings to meet an agreed 3.5% budget surplus target before interest payments in 2018.

The reforms were passed ahead of a Eurogroup meeting at 1400 BST where ministers will discuss Greece’s third international bailout.

“Of course these meetings have a tendency to disappoint, especially when the matter under discussion is Greece, so it will be interesting to see if the eurozone indices’ robust rebound can be sustained as the day continues,” said Connor Campbell, financial analyst at Spreadex.

“The FTSE seemed to benefit from the eurozone’s surge this Monday, the run-off goodwill causing the UK index to rise around half a percent despite a stubbornly red showing from its mining stocks following another fall in Chinese imports and exports.”

China’s exports fell 1.8% in April compared with the same month last year while imports declined 10.9%, according to official data.

Data elsewhere showed German factory orders rose 1.7% year-on-year in March, beating estimates for a 0.1% and following a 0.7% increase a month earlier.

Eurozone investor confidence rose more than expected in May but remained subdued, according to a report by Sentix on Monday. The investor sentiment index climbed to 6.2 in May from 5.7 in April, beating forecasts of 6.0. However, it remains well below levels recorded last year.

In the UK, house prices fell 0.8% in April compared to a month ago, more than the 0.3% drop expected by analysts and after a 2.6% jump in March, Halifax said. The decline follows the introduction of extra stamp duty for second home owners and buy-to-let investors on 1 April and comes amid uncertainty leading up to the 23 June European Union referendum.

In company news, mining stocks were under pressure as metal prices slumped including gold, silver, copper and platinum. Iron ore was also in freefall with futures on the Dalian Commodity Exchange for delivery in September down by 6% to 338 yuan a tonne. Miners Anglo American, Rio Tinto, Glencore and Antofagasta were among the biggest fallers.

Greggs gained after reporting a 5.7% rise in like-for-like sales in the first 18 weeks of 2016, despite the tepid conditions on British high streets.

Smith & Nephew jumped after Jefferies upgraded the artificial knee and hip maker to ‘buy’ from ‘hold’ and lifted the price target to 1,375p from 1,044p.

EasyJet soared after RBC Capital Markets upgraded the airline to ‘outperform’ from ‘underperform’ and lifted the price target to 1,500p from 1,450p. Fellow travel firm TUI also rallied.

Security firm G4S climbed after saying it has made a positive start to the year despite a challenging backdrop, with no new impairments.

Interserve was in the red as Berenberg cut its target price to 520p from 645p after the company highlighted contractual issues in a trading update.

Market Movers

FTSE 100 (UKX) 6,160.66 0.57%
FTSE 250 (MCX) 16,755.46 0.64%
techMARK (TASX) 3,068.15 1.18%

FTSE 100 - Risers

TUI AG Reg Shs (DI) (TUI) 1,030.00p 3.00%
AstraZeneca (AZN) 3,907.50p 2.87%
ARM Holdings (ARM) 956.00p 2.69%
easyJet (EZJ) 1,454.00p 2.68%
Inmarsat (ISAT) 832.00p 2.40%
Dixons Carphone (DC.) 420.90p 2.31%
Smith & Nephew (SN.) 1,162.00p 2.29%
Whitbread (WTB) 3,884.00p 2.16%
3i Group (III) 467.60p 2.10%
Paddy Power Betfair (PPB) 9,055.00p 1.91%

FTSE 100 - Fallers

Anglo American (AAL) 608.10p -6.36%
Glencore (GLEN) 138.85p -4.64%
Rio Tinto (RIO) 2,043.00p -4.24%
Fresnillo (FRES) 1,060.00p -3.90%
Antofagasta (ANTO) 426.20p -3.47%
BHP Billiton (BLT) 819.10p -3.03%
Randgold Resources Ltd. (RRS) 6,025.00p -2.27%
Sainsbury (J) (SBRY) 264.80p -0.64%
Royal Mail (RMG) 492.50p -0.46%
Royal Dutch Shell 'B' (RDSB) 1,754.00p -0.43%

FTSE 250 - Risers

G4S (GFS) 195.90p 6.29%
Greggs (GRG) 1,114.00p 4.31%
TalkTalk Telecom Group (TALK) 266.00p 3.50%
CLS Holdings (CLI) 1,560.00p 3.38%
Spire Healthcare Group (SPI) 333.60p 2.99%
Greencore Group (GNC) 368.90p 2.50%
ICAP (IAP) 475.10p 2.48%
Morgan Advanced Materials (MGAM) 237.60p 2.41%
Beazley (BEZ) 346.00p 2.31%
Tullow Oil (TLW) 250.60p 2.20%

FTSE 250 - Fallers

Kaz Minerals (KAZ) 156.90p -6.44%
Evraz (EVR) 123.00p -5.89%
Interserve (IRV) 310.40p -5.74%
Centamin (DI) (CEY) 114.70p -5.60%
Vedanta Resources (VED) 370.20p -4.39%
Allied Minds (ALM) 340.00p -4.01%
Acacia Mining (ACA) 316.80p -3.59%
AA (AA.) 278.90p -2.65%
Dignity (DTY) 2,450.00p -2.20%
Ophir Energy (OPHR) 66.90p -1.91%