London close: Stocks cling to gains as housebuilders, Royal Mail rise

The FTSE 100 ended the session up 0.12% at 7,077.22, and the FTSE 250 was 0.33% firmer at 22,908.06.

Sterling was in a mixed state, last trading 0.16% stronger on the dollar at $1.4179, while weakening 0.15% against the euro to €1.1625.

“It’s been a relatively subdued session for European markets today with the DAX posting yet another notional record high, while the FTSE 100 looks to be on course for a positive session, despite weakness in mining stocks which is acting as a drag, due to disappointment over the latest China trade numbers,” said CMC Markets chief market analyst Michael Hewson.

“BT Group is near the top of the FTSE 100 today after Jefferies raised its price target to 260p per share.

“IAG also got an afternoon lift on a report that US and UK airlines had issued a joint plea for a resumption of transatlantic travel between the two countries, led by the CEOs of Delta, United and American Airlines, who argued that the scope was there for the vaccination progress on both sides of the Atlantic should allow a relaxation of the restrictions.”

Research released earlier showed footfall at UK retail destinations surged last week, boosted by warm weather and the half-term holiday.

Footfall at all retail destinations rose 11.6% from the week before, according to Springboard, with footfall on high streets up 17.4%, while shopping centres and retail parks saw increases of 8.7% and 2.3%, respectively.

In coastal and historic town centres footfall was significantly better, up 37.1% and 24.8%, respectively.

The south-west was a particularly bright spot as visitors flocked to resorts, with the biggest rise in footfall of any part of the UK, at 18.8% overall and 30.8% for high streets.

Footfall in central London grew 23.8% and city centres elsewhere in the UK saw growth of 19.3%.

“A combination of the late May bank holiday, incredible weather and the school half term holiday had a hugely beneficial effect on customer activity in UK retail destinations last week; it not only led to the greatest weekly increase in footfall since the reopening of non-essential retail in April, but also the most modest annual decline since the start of the pandemic,” said Diane Wehrle, insights director at Springboard.

“Inevitably visitors wanted to be outside to enjoy the weather, so by far the greatest benefit was seen by high streets, where the rise in footfall from the week before was double that in shopping centres, and eight times that in retail parks.

“Staycations clearly fuelled an increase in footfall in coastal towns which surpassed that in any other type of high street, and a rise in footfall in high streets in the south-west that was nearly double the increase in high streets across the UK and in Greater London.”

Earlier in the global day, official data out of Beijing showed that China’s export growth slowed more than expected in May.

Exports rose 27.9% year-on-year in May, down from 32.3% growth the month before and coming in below consensus expectations for 32.1% growth.

Imports rose 51.1% compared to a 43.1% increase in April, marking the fastest growth in a decade but was below expectations for a 53.5% jump.

The unadjusted trade surplus ticked up to $45.5bn in May from a revised $42.9bn in April, coming in below consensus expectations of $50.7bn.

Investors were also mulling comments by US Treasury Secretary Janet Yellen, who said over the weekend that higher interest rates would be a "plus" for the US.

“While this seems a perfectly logical and reasonable statement, it contains a hint of menace for the markets given what rising rates normally mean for the performance of equities,” said Russ Mould, investment director at AJ Bell.

"This hint of menace might become something more genuinely frightening for investors if it is followed by a high level of inflation when the US figures are published later this week.

"Very quickly the issue of rising prices and their impact on monetary policy could become front and centre again, after being pushed to the back of the market’s mind by a US jobs report on Friday which, while not terrible, presented a fragile enough picture of employment to suggest the US Federal Reserve would maintain low rates and financial stimulus for longer.”

In equity markets, Royal Mail was up 1.42% following reports it will offer timed delivery slots next year as it looks to compete with Amazon.

Housebuilders rallied after the latest survey from Halifax showed that house prices hit another record high in May, with annual growth up 9.5%, while month-on-month, house prices were up 1.3%.

The sector was also boosted by a note from Liberum, which upgraded Taylor Wimpey to ‘buy’ from ‘hold’ and said Persimmon was still its large-cap "top pick".

Berkeley Group was up 0.79%, Persimmon added 2.7%, Taylor Wimpey was ahead 1.14%, and Vistry advanced 1.35%.

Elsewhere, consumer goods group Reckitt Benckiser edged 0.72% lower as it agreed to sell its baby formula business in China to the private equity firm Primavera for $2.2bn.

Miners were among the losers after the Chinese trade data and as base metals prices fell, with Anglo American down 3.12%, Antofagasta off 2.75%, and Glencore 1.83% lower.

Workspace provider IWG plunged 10.26% after it warned that underlying earnings for 2021 were set to be "well below" the previous year’s level due to the prolonged impact of Covid-related restrictions in some of its markets.

Market Movers

FTSE 100 (UKX) 7,077.22 0.12%
FTSE 250 (MCX) 22,908.06 0.33%
techMARK (TASX) 4,401.20 0.31%

FTSE 100 - Risers

BT Group (BT.A) 183.50p 3.67%
International Consolidated Airlines Group SA (CDI) (IAG) 201.80p 2.78%
Persimmon (PSN) 3,246.00p 2.70%
Rolls-Royce Holdings (RR.) 110.10p 2.61%
Informa (INF) 553.00p 2.29%
Admiral Group (ADM) 3,119.00p 2.00%
Land Securities Group (LAND) 728.80p 1.76%
Barratt Developments (BDEV) 768.20p 1.67%
WPP (WPP) 1,012.50p 1.66%
Barclays (BARC) 186.98p 1.64%

FTSE 100 - Fallers

Anglo American (AAL) 3,153.00p -3.12%
Antofagasta (ANTO) 1,521.00p -2.75%
B&M European Value Retail S.A. (DI) (BME) 525.60p -2.56%
Polymetal International (POLY) 1,668.50p -2.00%
Glencore (GLEN) 323.90p -1.83%
Weir Group (WEIR) 1,889.00p -1.46%
Fresnillo (FRES) 863.80p -1.33%
Rio Tinto (RIO) 6,140.00p -1.25%
BHP Group (BHP) 2,145.50p -1.15%
Aveva Group (AVV) 3,469.00p -1.14%

FTSE 250 - Risers

Liontrust Asset Management (LIO) 1,596.00p 5.92%
NCC Group (NCC) 306.50p 5.69%
Crest Nicholson Holdings (CRST) 463.80p 4.65%
Oxford Instruments (OXIG) 2,145.00p 3.62%
FDM Group (Holdings) (FDM) 995.00p 3.22%
easyJet (EZJ) 963.00p 3.13%
Meggitt (MGGT) 515.20p 3.04%
ITV (ITV) 131.45p 2.98%
National Express Group (NEX) 296.00p 2.78%
Drax Group (DRX) 454.20p 2.71%

FTSE 250 - Fallers

IWG (IWG) 328.90p -10.26%
Chemring Group (CHG) 306.50p -4.81%
Hochschild Mining (HOC) 190.50p -4.42%
Rank Group (RNK) 189.60p -3.95%
Energean (ENOG) 800.50p -3.62%
Avon Rubber (AVON) 2,862.00p -3.60%
Sanne Group (SNN) 767.00p -3.27%
Centamin (DI) (CEY) 112.10p -2.99%
Wickes Group (WIX) 267.00p -2.91%
Cineworld Group (CINE) 90.68p -2.54%