London open: Stocks dip despite tentative moves to reopen international travel

"The slow, but steady increase in Covid-19 cases across Asia, ex-India, is weighing on sentiment in early Asian trading. India's situation dominated the weekend press, but across Japan, South Korea and Thailand and others in between, Covid-19 is undermining confidence in cyclical recovery that many, including the author, has priced into their H2 2021 outlooks," said Jeffrey Halley, Senior Market Analyst, Asia Pacific, OANDA.

"In all honesty, it is much too soon to draw conclusions on this scenario, although we will have a much better picture, I believe, in a few weeks as the situation evolves."

The number of new Covid-19 infections in India hit a fifth consecutive daily record on Monday of 352,991.

As of 0815 BST, the FTSE 100 had dipped 0.22% or 15.54 points to 6,923.02, while the FTSE 250 was edging up 0.02% and trading at 22,377.52.

Halley nevertheless believed that the situation in India and elsewhere could feed into the US central bank's calculus when it met to decide on policy on Wednesday.

So too with the Bank of Japan's monetary policy meeting scheduled for the next.

"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."

Related to the possible reopening of economies, but this time on either side of the Atlantic, overnight, the head of the European Commission said that tourists with proof of vaccination may be allowed to resume travel in summer.

"The Americans, as far as I can see, use European Medicines Agency-approved vaccines," Ursula von der Leyen, said in an interview with The New York Times on Sunday.

"This will enable free movement and the travel to the European Union."

On the economic calendar for Monday, the closely-followed IFO business confidence index for Germany is scheduled for release at 0900 BST.

At 1330 BST, US durable goods orders figures for March will be published at 1330 BST.

No major economic reports are due out in the UK.

IMI ups guidance and approves share buyback plan

IMI announced a £200m share buyback and raised its guidance for annual earnings after group performance improved in the first quarter. The FTSE 250 company predicted earnings per share of between 81p an 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. IMI said based on its improving performance it would buy back £200m of shares to make the balance sheet more efficient while leaving "ample capacity" for investment and potential acquisitions.

Educational publisher Pearson reported underlying first quarter revenue growth of 5% driven by demand for global online learning. The company on Monday said its online division revenue increased 25% with strong growth in Virtual Schools due to enrolment growth in the current school year in Partner Schools as well as in US district partnerships. International sales were down 2% with a decline in English as Covid-19 continued to impact Pearson’s courseware and franchise business in Latin America, despite courseware recovery in China.

AstraZeneca said on Monday 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 FTSE 100 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, and confirmed that ‘Tagrisso’, or osimertinib, had been recommended for marketing authorisation in the EU for the adjuvant treatment of adult patients with early-stage epidermal growth factor receptor-mutated non-small cell lung cancer, after complete tumour resection with curative intent.

Market Movers

FTSE 100 (UKX) 6,918.74 -0.29%
FTSE 250 (MCX) 22,364.34 -0.04%
techMARK (TASX) 4,353.74 -0.21%

FTSE 100 - Risers

Rolls-Royce Holdings (RR.) 104.18p 2.38%
Pearson (PSON) 815.00p 1.75%
International Consolidated Airlines Group SA (CDI) (IAG) 200.10p 1.71%
Intertek Group (ITRK) 6,296.00p 1.58%
Admiral Group (ADM) 3,227.00p 1.00%
Evraz (EVR) 652.60p 0.93%
Antofagasta (ANTO) 1,844.00p 0.90%
Fresnillo (FRES) 901.00p 0.85%
Rio Tinto (RIO) 6,162.00p 0.70%
Standard Life Aberdeen (SLA) 274.10p 0.66%

FTSE 100 - Fallers

InterContinental Hotels Group (IHG) 5,104.00p -1.51%
United Utilities Group (UU.) 945.00p -1.46%
British American Tobacco (BATS) 2,697.00p -1.35%
Associated British Foods (ABF) 2,268.00p -1.13%
Lloyds Banking Group (LLOY) 42.18p -1.08%
Royal Dutch Shell 'A' (RDSA) 1,341.80p -1.06%
Prudential (PRU) 1,494.00p -1.06%
Taylor Wimpey (TW.) 185.40p -1.04%
Smith (DS) (SMDS) 418.90p -1.02%
Aviva (AV.) 395.20p -0.95%

FTSE 250 - Risers

Tate & Lyle (TATE) 806.60p 6.55%
IMI (IMI) 1,479.00p 5.87%
Bytes Technology Group (BYIT) 520.00p 3.07%
TBC Bank Group (TBCG) 1,090.00p 2.83%
Ferrexpo (FXPO) 441.00p 2.75%
Crest Nicholson Holdings (CRST) 422.00p 2.63%
Lancashire Holdings Limited (LRE) 680.00p 2.41%
easyJet (EZJ) 1,005.50p 1.94%
Future (FUTR) 2,374.00p 1.54%
Ibstock (IBST) 229.80p 1.41%

FTSE 250 - Fallers

SSP Group (SSPG) 329.30p -4.63%
Contour Global (GLO) 193.40p -3.01%
Aston Martin Lagonda Global Holdings (AML) 1,919.50p -1.87%
UK Commercial Property Reit Limited (UKCM) 75.00p -1.83%
Tullow Oil (TLW) 46.20p -1.68%
Indivior (INDV) 140.20p -1.54%
Babcock International Group (BAB) 295.60p -1.47%
Vietnam Enterprise Investments (DI) (VEIL) 631.00p -1.41%
Pennon Group (PNN) 1,015.50p -1.36%
Carnival (CCL) 1,633.00p -1.29%