London open: Stocks rally on positive US cues; miners in the black

London stocks kicked off February on the front foot on Tuesday, taking their cue from a positive session on Wall Street.

At 0855 GMT, the FTSE 100 was up 0.9% at 7,529.03.

Victoria Scholar, head of investment at Interactive Investor, said: "European markets are making a fresh start in February, attempting to put the January gyrations to one side as all major bourses trade in the green with financials and basic recourses leading the gains. The DAX is leading the charge up by 1% while the FTSE 100 stages convincing gains pushing away from support at 7,500 with 7,550 the near-term resistance level to eye.

"Amid the market turmoil in January with the S&P 500 logging its worst month since March 2020 and with Europe’s Stoxx 600 suffering its sharpest decline since October 2020, the FTSE 100 managed to buck the downtrend, eking out a modest 1.1% monthly gain. Having fallen out of favour since Brexit, the rotation away from US tech has provided an opportunity for the FTSE 100 to play catch up, thanks to the indices in vogue leaning towards energy and financials and its attractive valuations.

"There is also a sense among investors that despite the naysayers, the City of London has upheld its position as a leading global financial hub post Brexit, with international flows returning to the UK market."

On the macro front, net lending, consumer credit and Markit’s manufacturing PMI are all due at 0930 GMT.

Before that, though, investors were mulling over the latest survey from Nationwide, which showed that the housing market had its strongest start to the year for nearly two decades in January as supply failed to keep up with "robust" demand.

According to the latest Nationwide house price index, annual house price growth rose to 11.2% in January, compared to 10.4% in December. The above-consensus rise was the highest since June 2021, and the strongest start to the year for 17 years. Analysts had been expecting growth closer to 10.9%.

Month-on-month, prices rose by 0.8% which, once seasonal effects were accounted for, was the sixth consecutive monthly increase. It was below December’s rise of 1.1% but ahead of forecasts; most analysts had been expecting a rise of around 0.6%.

The average price of a property now stands at £255,556, compared to £254,822 a month previously. Nationwide attributed the growth to strong demand and limited supply.

Robert Gardner, Nationwide chief economist, said: "Housing demand has remained robust. Mortgage approvals for house purchase have continued to run slightly above pre-pandemic levels, despite the surge in activity in 2021 as a result of the stamp duty holiday, which encouraged buyers to bring forward their transactions to avoid additional tax.

"At the same time, the stock of homes on estate agents’ books has remained extremely low, which is contributing to the continued pace of house price growth."

In equity markets, miners were among the standout gainers as metals prices rose, with Rio Tinto, Anglo American and Glencore all higher.

Elsewhere, lender Virgin Money was trading up after it lifted guidance for its net interest margin - the difference between borrowing and savings rates - as the economy recovered from the Covid pandemic and inflation pushed up the cost of loans.

Market Movers

FTSE 100 (UKX) 7,529.03 0.87%
FTSE 250 (MCX) 22,207.02 1.28%
techMARK (TASX) 4,451.92 0.51%

FTSE 100 - Risers

Scottish Mortgage Inv Trust (SMT) 1,124.00p 4.17%
Experian (EXPN) 3,169.00p 2.86%
Polymetal International (POLY) 1,090.50p 2.78%
Rio Tinto (RIO) 5,323.00p 2.66%
Anglo American (AAL) 3,311.00p 2.57%
Intermediate Capital Group (ICP) 1,945.00p 2.56%
CRH (CDI) (CRH) 3,803.00p 2.42%
Glencore (GLEN) 392.00p 2.35%
3i Group (III) 1,402.00p 2.34%
Entain (ENT) 1,626.00p 2.20%

FTSE 100 - Fallers

Vodafone Group (VOD) 127.58p -1.88%
AstraZeneca (AZN) 8,482.00p -1.57%
Ocado Group (OCDO) 1,484.50p -1.30%
British American Tobacco (BATS) 3,129.50p -1.07%
Imperial Brands (IMB) 1,733.50p -1.03%
Sainsbury (J) (SBRY) 289.00p -0.58%
BT Group (BT.A) 194.60p -0.49%
Avast (AVST) 612.80p -0.07%
Hikma Pharmaceuticals (HIK) 2,078.00p 0.00%
Meggitt (MGGT) 745.80p 0.11%

FTSE 250 - Risers

Petershill Partners (PHLL) 224.50p 4.18%
Petropavlovsk (POG) 15.58p 4.07%
Baillie Gifford US Growth Trust (USA) 243.50p 4.06%
Allianz Technology Trust (ATT) 297.50p 4.02%
Moonpig Group (MOON) 323.40p 3.59%
Trainline (TRN) 232.00p 3.57%
Kainos Group (KNOS) 1,575.00p 3.55%
CMC Markets (CMCX) 238.00p 3.48%
National Express Group (NEX) 257.60p 3.04%
Ferrexpo (FXPO) 249.00p 2.98%

FTSE 250 - Fallers

Playtech (PTEC) 576.00p -1.37%
Hipgnosis Songs Fund Limited NPV (SONG) 116.60p -1.35%
Currys (CURY) 105.50p -0.75%
Cineworld Group (CINE) 38.97p -0.69%
Vietnam Enterprise Investments (DI) (VEIL) 738.00p -0.67%
PureTech Health (PRTC) 271.00p -0.55%
Great Portland Estates (GPOR) 757.50p -0.53%
Fidelity Emerging Markets Limited Ptg NPV (FEML) 782.00p -0.51%
Workspace Group (WKP) 841.50p -0.36%
Derwent London (DLN) 3,393.00p -0.35%