London open: FTSE kicks off new year in style as travel stocks surge

London stocks kicked off the new year in style on Tuesday, with travel shares pacing the gains as investors welcomed signs that Omicron is less severe than previous Covid variants.

At 0840 GMT, the FTSE 100 was up 1.1% at 7,464.16, tracking a positive session on Wall Street, which saw the Dow and the S&P hit record highs.

Richard Hunter, head of markets at Interactive Investor, said: "In the first trading day of the year, the FTSE100 took its cue from Wall Street with a broad mark-up of stocks. Having finished 2021 ahead by 14.3%, the premier index may also benefit further from the continuing strength of the US dollar, whereby translated earnings become more valuable for its largely overseas-facing constituents.

"Meanwhile, the imminent reporting season will add further colour to the impact of both the variant and inflationary pressures on earnings, although the early signs are that the consequences may be less detrimental than in previous cases of lockdowns and restrictions. In the meantime, the premier index remains well placed on valuation grounds to attract further international buying interest."

In equity markets, travel shares were the standout gainers, with BA and Iberia owner IAG the top riser on the FTSE 100, closely followed by engine maker Rolls-Royce. Premier Inn owner Whitbread, InterContinental Hotels, Carnival, easyJet, Wizz, Tui and SSP were all sharply higher.

Wizz Air was also in focus after it said December capacity soared by almost 200% year on year, reflecting eased Covid-19 restrictions.

Market Movers

FTSE 100 (UKX) 7,464.16 1.08%
FTSE 250 (MCX) 23,805.02 1.38%
techMARK (TASX) 4,591.31 0.26%

FTSE 100 - Risers

International Consolidated Airlines Group SA (CDI) (IAG) 154.16p 8.20%
Rolls-Royce Holdings (RR.) 127.52p 3.78%
BP (BP.) 341.50p 3.33%
Ferguson (FERG) 13,505.00p 3.05%
Whitbread (WTB) 3,082.00p 2.90%
Royal Dutch Shell 'B' (RDSB) 1,666.60p 2.72%
Royal Dutch Shell 'A' (RDSA) 1,665.00p 2.66%
M&G (MNG) 204.40p 2.46%
Kingfisher (KGF) 346.40p 2.39%
InterContinental Hotels Group (IHG) 4,895.00p 2.38%

FTSE 100 - Fallers

Fresnillo (FRES) 875.60p -1.93%
Polymetal International (POLY) 1,290.50p -1.60%
AstraZeneca (AZN) 8,593.00p -0.98%
SEGRO (SGRO) 1,422.50p -0.97%
Relx plc (REL) 2,380.00p -0.92%
Rentokil Initial (RTO) 579.00p -0.86%
Dechra Pharmaceuticals (DPH) 5,295.00p -0.56%
Hikma Pharmaceuticals (HIK) 2,208.00p -0.50%
GlaxoSmithKline (GSK) 1,600.00p -0.41%
Croda International (CRDA) 10,090.00p -0.30%

FTSE 250 - Risers

Carnival (CCL) 1,485.20p 7.34%
easyJet (EZJ) 596.00p 7.19%
Wizz Air Holdings (WIZZ) 4,479.00p 6.95%
TUI AG Reg Shs (DI) (TUI) 245.00p 5.88%
SSP Group (SSPG) 252.50p 5.16%
Rank Group (RNK) 163.60p 4.87%
Marks & Spencer Group (MKS) 241.60p 4.41%
Cineworld Group (CINE) 33.24p 3.91%
Wood Group (John) (WG.) 198.45p 3.85%
Watches of Switzerland Group (WOSG) 1,474.00p 3.80%

FTSE 250 - Fallers

FDM Group (Holdings) (FDM) 1,232.00p -3.14%
Endeavour Mining (EDV) 1,645.00p -1.50%
PureTech Health (PRTC) 288.00p -1.37%
JPMorgan Japanese Inv Trust (JFJ) 656.00p -1.35%
Bytes Technology Group (BYIT) 561.00p -1.15%
Ultra Electronics Holdings (ULE) 3,146.00p -1.07%
Indivior (INDV) 254.80p -0.86%
Ninety One (N91) 275.00p -0.79%
Reach (RCH) 280.50p -0.71%
Cranswick (CWK) 3,682.00p -0.54%