London close: Stocks rally as investors put coronavirus worries to one side
London stocks rallied on Tuesday as BP gained on the back of well-received results, while miners also put in a strong performance.
The FTSE 100 jumped back by 1.55% to reach 7,439.82, with sterling 0.24% firmer against the US dollar at 1.3030, back above $1.30 after falling sharply on Monday amid worries about a hard Brexit.
"The rally has been broad-based, too, encompassing sectors and countries in a manner that suggests investors have mostly overcome their fears about a global outbreak and are putting money back to work again," said IG's Chris Beauchamp.
"BP has risen almost 3% today, undoubtedly helped by the sunnier attitude to risk this week when compared to last week, helping the stock to shrug off a 20% decline in income in a way that will make its counterparts at Shell rather green with envy."
On home turf, there was some encouraging news on the macroeconomic front after data showed that the UK construction sector improved somewhat in January as demand picked up and optimism increased.
The IHS Markit/CIPS construction activity index rose to 48.4 in January from 44.4 the month before. The figure showed activity falling but at the slowest pace for eight months and significantly better than sharp drops at the end of 2019.
Survey respondents reported increased client demand after the Conservatives' resounding general election victory in December. As a result, construction companies are more positive about growth prospects than at any time since April 2018.
Tim Moore, economics associate director at survey compiler IHS Markit, said: "The construction sector downturn lost intensity in January amid slower reductions in house building, commercial work and civil engineering activity.
"The latest dip in construction output was much shallower than in December, with survey respondents often commenting on improved willingness to spend among clients since the general election."
In equity markets, miners were the standout gainers as copper prices advanced, with Glencore, Antofagasta and Anglo American all up. Glencore was higher even as it reported a 6% fall in copper production for 2019 after the miner and commodities trader shut down its mine in the Democratic Republic of Congo.
Ferguson was the second best performer after the plumbing parts distributor said it was considering a primary or additional listing in the US and announced a $500.0m share buyback.
Oil giant BP followed close behind as it reported better-than-expected full-year results and lifted its dividend despite a weaker price environment that led to a sharp fall in profits.
The company said underlying replacement cost profit, its measure of net profit, for the fourth quarter and full year was $2.6bn and $10bn respectively, compared to $3.5bn and $12.7bn for the same periods a year earlier, reflecting the impact of softer prices. Analysts had expected full-year net profit to come in at $9.7bn.
On the downside, Micro Focus tumbled as it reported a decline in full-year profit and sales and announced the departure of its chairman following what it referred to as a "challenging" year.
Budget airline Wizz Air flew recovered from early losses after its largest shareholder, private equity firm Indigo Partners, sold 12.45m shares in the company for £500.0m in an accelerated bookbuild.
Market Movers
FTSE 100 (UKX) 7,439.82 1.55%
FTSE 250 (MCX) 21,439.93 1.32%
techMARK (TASX) 4,153.35 0.07%
FTSE 100 - Risers
Ferguson (FERG) 7,402.00p 7.28%
Evraz (EVR) 381.70p 7.13%
Glencore (GLEN) 233.10p 5.19%
BP (BP.) 471.80p 4.22%
Ashtead Group (AHT) 2,590.00p 4.14%
Scottish Mortgage Inv Trust (SMT) 621.50p 3.93%
JD Sports Fashion (JD.) 865.20p 3.87%
Anglo American (AAL) 2,066.50p 3.72%
Johnson Matthey (JMAT) 2,701.00p 3.45%
International Consolidated Airlines Group SA (CDI) (IAG) 594.40p 3.37%
FTSE 100 - Fallers
NMC Health (NMC) 1,006.00p -2.90%
Polymetal International (POLY) 1,222.00p -2.78%
Centrica (CNA) 83.94p -2.03%
Severn Trent (SVT) 2,565.00p -1.12%
United Utilities Group (UU.) 995.20p -0.98%
Croda International (CRDA) 4,998.00p -0.83%
SEGRO (SGRO) 905.80p -0.77%
Meggitt (MGGT) 676.40p -0.73%
Kingfisher (KGF) 204.10p -0.44%
BT Group (BT.A) 162.82p -0.32%
FTSE 250 - Risers
Kaz Minerals (KAZ) 474.30p 7.31%
Electrocomponents (ECM) 713.00p 6.23%
Vivo Energy (VVO) 111.40p 6.10%
ICG Enterprise Trust (ICGT) 980.00p 6.06%
FirstGroup (FGP) 125.10p 6.02%
PureTech Health (PRTC) 299.00p 4.91%
Hunting (HTG) 311.20p 4.78%
QinetiQ Group (QQ.) 372.80p 4.66%
TI Fluid Systems (TIFS) 247.50p 4.43%
Galliford Try (GFRD) 158.14p 4.41%
FTSE 250 - Fallers
Micro Focus International (MCRO) 766.80p -22.27%
Domino's Pizza Group (DOM) 299.00p -4.17%
Aston Martin Lagonda Global Holdings (AML) 459.20p -3.57%
Fresnillo (FRES) 622.20p -3.08%
Future (FUTR) 1,298.00p -2.55%
Britvic (BVIC) 923.00p -2.33%
Royal Mail (RMG) 190.75p -1.85%
Hochschild Mining (HOC) 161.20p -1.83%
Hammerson (HMSO) 227.90p -1.60%
IntegraFin Holding (IHP) 502.00p -1.57%