London open: Stocks edge up on Biden infrastructure deal

London stocks edged up in early trade on Friday, with sentiment boosted after US President Joe Biden announced a bipartisan agreement on an infrastructure deal, but gains were limited ahead of the release of US inflation data.

At 0825 BST, the FTSE 100 was up 0.2% at 7,127.10.

Jeffrey Halley, senior market analyst at Oanda, said: "A bipartisan group of Senators presented an acceptable, but much slimmed-down infrastructure agreement to the President that will still total around $1.2 trillion over the next eight years.

"That will still pay for a lot of Bobs to build ‘stuff’ to move people around in the US, stay connected on the internet and keep lights and heating on. However, challenges remain with the additional $1.8 trillion of social spending plans and proposed tax increases on the wealthy and corporations still stuck in a deep freeze. Mr Biden and Ms Pelosi expect those bills to progress along with the infrastructure as part of a greater overall package."

On home shores, a survey released earlier by GfK showed consumer sentiment was stable in June but concerns about rising inflation appear to have undermined households' confidence in the economic outlook.

The UK consumer confidence index was unchanged at -9 in June and four of the index's measures improved from a month earlier.

People's view of their financial situation over the past 12 months improved to zero from -4 and the personal financial outlook edged up one point to 11. Views on the economic situation over the past year and whether to make a large purchase also improved slightly.

The biggest change was in household's view of the general economic situation over the next 12 months, which dipped to -2 from +4 in a month. The score was still 46 points higher than June 2020.

Joe Staton, GfK's client strategy director, said: "The upwards trajectory for the index since the dark days at the start of the pandemic is currently still on track. However, forecasts for rising retail price inflation could weaken consumer confidence quickly and that may account for the six-point dip in June in our measure for the wider economy in the coming year."

Looking ahead to the rest of the day, investors will be eyeing the release of US inflation data for May at 1330 BST.

In equity markets, JD Sports was the standout gainer on the FTSE 100 following well-received fourth-quarter results from Nike in the US.

Irish building materials group CRH and equipment rental firm Ashtead, both of which do business in the US, rallied on news of the infrastructure deal.

Elsewhere, UDG Healthcare was a little firmer after it said US private equity firm Clayton Dubilier & Rice was considering an improved final offer of 1,080p a share for the company. The two companies in May had agreed a 1,023p-a-share deal in May, valuing UDG at £2.6bn, but major shareholders, including Allianz Global Investors and M&G Investments, said the offer undervalued the Irish outfit.

Market Movers

FTSE 100 (UKX) 7,127.10 0.24%
FTSE 250 (MCX) 22,532.99 0.10%
techMARK (TASX) 4,455.47 -0.17%

FTSE 100 - Risers

JD Sports Fashion (JD.) 950.80p 4.19%
CRH (CDI) (CRH) 3,791.00p 2.79%
Aveva Group (AVV) 3,765.00p 2.09%
WPP (WPP) 999.20p 2.00%
International Consolidated Airlines Group SA (CDI) (IAG) 195.02p 1.48%
Ashtead Group (AHT) 5,372.00p 1.36%
BP (BP.) 328.60p 1.33%
Rolls-Royce Holdings (RR.) 108.98p 1.11%
HSBC Holdings (HSBA) 428.95p 1.02%
Barclays (BARC) 176.18p 1.02%

FTSE 100 - Fallers

Halma (HLMA) 2,689.00p -1.25%
Rightmove (RMV) 658.60p -0.90%
Coca-Cola HBC AG (CDI) (CCH) 2,653.00p -0.86%
London Stock Exchange Group (LSEG) 8,118.00p -0.78%
Pershing Square Holdings Ltd NPV (PSH) 2,600.00p -0.76%
Flutter Entertainment (CDI) (FLTR) 14,265.00p -0.73%
M&G (MNG) 239.60p -0.62%
Sage Group (SGE) 684.40p -0.52%
Croda International (CRDA) 7,182.00p -0.50%
Unilever (ULVR) 4,229.00p -0.46%

FTSE 250 - Risers

Elementis (ELM) 154.90p 4.73%
Helios Towers (HTWS) 168.60p 3.44%
Drax Group (DRX) 440.40p 2.51%
Virgin Money UK (VMUK) 201.40p 2.08%
Future (FUTR) 3,234.00p 1.95%
Wood Group (John) (WG.) 210.60p 1.94%
Fidelity China Special Situations (FCSS) 416.50p 1.59%
Greggs (GRG) 2,555.00p 1.39%
Coats Group (COA) 67.90p 1.34%
Law Debenture Corp. (LWDB) 766.00p 1.32%

FTSE 250 - Fallers

CLS Holdings (CLI) 239.00p -2.45%
Grainger (GRI) 286.60p -2.38%
Vistry Group (VTY) 1,189.00p -2.02%
Domino's Pizza Group (DOM) 378.20p -1.92%
Morgan Sindall Group (MGNS) 2,175.00p -1.81%
Contour Global (GLO) 187.80p -1.78%
Renishaw (RSW) 4,914.00p -1.72%
Capita (CPI) 38.50p -1.66%
Rank Group (RNK) 166.80p -1.30%
Carnival (CCL) 1,679.00p -0.97%