London close: Travel stocks help carry FTSE into the green
Stocks in London managed a positive finish on Monday, after the head of the European Commission signaled that the European Union may open its borders to non-essential travel from the US by summer.
The FTSE 100 ended the session up 0.35% at 6,963.12, and the FTSE 250 was 0.92% firmer at 22,577.34.
Sterling was in the green as well, last gaining 0.06% on the dollar to $1.3884, and strengthening 0.11% against the euro to €1.1491.
“A glimpse of a post-crisis future was captured today, where the haves and the have nots will be decided on the speed of vaccination programmes in countries around the world,” said Hargreaves Lansdown senior investment and markets analyst Susannah Streeter.
“Travel stocks soared higher during the London session today as hopes lifted that a big rescue could now be on the cards for the summer season, with the introduction of vaccine passports.
“Comments in the US media made by European Commission president Ursula von der Leyen indicated that European destinations would be open for inoculated Americans.”
The prospects of vaccine passports put a “spring in the step” of British Airways owner IAG and jet engine maker Rolls-Royce, Streeter quipped, helping propel the index into positive territory.
The coronavirus crisis was still causing concern for markets, as the number of new Covid-19 infections in India hit a fifth consecutive daily record of 352,991 for the day.
Jeffrey Halley at Oanda said the situation in India and elsewhere could feed into the US central bank's calculus when its top officials met on Wednesday to decide on policy, alongside rate-setters at the Bank of Japan who are set to meet later in the week.
"Those expecting hints of a Fed taper will be sorely disappointed with the FOMC likely to be in ‘we told you so’ mode," Halley said.
"Net-net, the Bank of Japan and FOMC should be positive for the buy-everything trade."
There were some positive developments, however, after EC head Ursula von der Leyen said overnight that US tourists with proof of vaccination could be allowed to resume travel in summer.
In an interview with the New York Times, von der Leyen said "the Americans, as far as I can see, use European Medicines Agency-approved vaccines.
In equity markets, Lancashire Holdings was up 3.69% and Beazley added 3.69% after Bank of America started coverage on both stocks at ‘buy’, while Hiscox advanced 2.09% after the same outfit set its maiden recommendation at ‘neutral’.
IMI surged 11.1% after it announced a £200m share buyback and raised its guidance for annual earnings, following an improvement in group performance in the first quarter.
The FTSE 250 company projected earnings per share of between 81p and 87p a share - up from an earlier estimate of 75p to 82p.
Organic revenue rose 7.7% in the three months to the end of March to £421m from a year earlier, and 2.6% compared with the first quarter of 2019.
Tate & Lyle was up 5.92% after it confirmed reports it was planning to sell a controlling stake in its primary products division to a “long-term financial partner”.
The 100-year-old firm said it believed that if a deal was completed, it would enable Tate & Lyle and the new business “to focus their respective strategies and capital allocation priorities and create the opportunity for enhanced shareholder value”.
Educational publisher Pearson gained 2.75% after it reported underlying first quarter revenue growth of 5% driven by demand for global online learning.
The company said its online division revenue increased 25% with strong growth in Virtual Schools due to enrollment growth in the current school year in Partner Schools as well as in US district partnerships.
Standard Life Aberdeen managed gains of 2.02% after it announced a name change to "Abrdn plc", dumping one of the oldest and best-known names in the savings and investment industry.
The Scottish asset manager said the new name was pronounced "Aberdeen" and would replace five brands including for all customer-facing businesses.
Chief executive Stephen Bird said the brand was "modern, dynamic and, most importantly, engaging".
Informa rose 3.75% after it agreed to combine its financial intelligence business with US advisory services provider Novantas, to provide data and information for US retail banks.
The deal was arranged as an acquisition of Novantas by Informa and Inflexion, a private equity firm, on a cash- and debt-free basis.
Informa will contribute its FBX business, whose assets have a fair value of $243m.
On the downside, AstraZeneca was 0.45% weaker after a raft of clinical data, first reporting that the phase 3 trial for ‘nirsevimab’ met its primary endpoint of a statistically significant reduction in the incidence of medically-attended lower respiratory tract infections caused by respiratory syncytial virus compared to placebo, in healthy late preterm and term infants.
The pharmaceutical giant also announced that ‘selumetinib’ had been recommended for conditional marketing authorisation in the EU for the treatment of symptomatic, inoperable plexiform neurofibromas in paediatric patients with neurofibromatosis type-1.
Market Movers
FTSE 100 (UKX)6,963.120.35%
FTSE 250 (MCX)22,577.340.92%
techMARK (TASX)4,375.600.29%
FTSE 100 - Risers
Rolls-Royce Holdings (RR.)107.82p5.96%
Antofagasta (ANTO)1,906.00p4.30%
International Consolidated Airlines Group SA (CDI) (IAG)204.75p4.20%
Melrose Industries (MRO)170.10p4.04%
Informa (INF)571.80p3.75%
Evraz (EVR)670.80p3.74%
British Land Company (BLND)527.20p3.37%
Glencore (GLEN)306.20p3.36%
Weir Group (WEIR)2,005.00p2.79%
Pearson (PSON)823.00p2.75%
FTSE 100 - Fallers
Diageo (DGE)3,214.00p-2.44%
Just Eat Takeaway.Com N.V. (CDI) (JET)7,826.00p-1.97%
Coca-Cola HBC AG (CDI) (CCH)2,483.00p-1.85%
Ocado Group (OCDO)2,203.00p-1.83%
United Utilities Group (UU.)943.00p-1.67%
London Stock Exchange Group (LSEG)7,606.00p-1.55%
Taylor Wimpey (TW.)184.55p-1.49%
Severn Trent (SVT)2,406.00p-1.31%
Smith & Nephew (SN.)1,474.00p-1.21%
Croda International (CRDA)6,858.00p-1.13%
FTSE 250 - Risers
IMI (IMI)1,553.00p11.10%
TUI AG Reg Shs (DI) (TUI)415.00p6.66%
Tate & Lyle (TATE)802.20p5.92%
Hammerson (HMSO)39.78p4.77%
Beazley (BEZ)341.40p4.56%
easyJet (EZJ)1,028.50p4.27%
Sanne Group (SNN)654.00p3.97%
Wood Group (John) (WG.)273.20p3.88%
Meggitt (MGGT)485.00p3.74%
Lancashire Holdings Limited (LRE)688.50p3.69%
FTSE 250 - Fallers
Petropavlovsk (POG)27.10p-2.73%
Drax Group (DRX)400.40p-2.66%
SSP Group (SSPG)338.90p-2.64%
FirstGroup (FGP)86.70p-2.47%
Oxford Biomedica (OXB)1,088.00p-1.98%
Just Eat Takeaway.Com N.V. (CDI) (JET)7,826.00p-1.97%
Pennon Group (PNN)1,011.00p-1.80%
Centamin (DI) (CEY)115.40p-1.54%
AJ Bell (AJB)435.40p-1.27%
PureTech Health (PRTC)398.00p-1.25%