London open: Stocks in the black as investors mull US stress tests

At 0840 BST, the FTSE 100 was up 1.1% at 6,212.07.

Market participants appeared to be focusing on the positives from the results of the Federal Reserve’s latest stress tests, which found that US banks were "well capitalised under even the harshest" of downside scenarios.

Spreadex analyst Connor Campbell said: "The Fed warned that loan losses in the aftermath of the Covid-19 pandemic could hit a staggering $700 billion. Yet Jerome Powell and co. didn’t then announce any particularly drastic measures to combat this, banning share buybacks - something that many bank had already abandoned - while keeping dividends intact at their current levels.

"It seems that investors have read this tepid response as a green light to keep buying, if at a relatively measured pace."

In equity markets, travel stocks were the standout gainers, with British Airways parent IAG, cruise operator Carnival, Premier Inn owner Whitbread and budget airline easyJet all trading up.

EasyJet was also in focus after it agreed a sale and leaseback deal for six Airbus A320neo aircraft for $255m (£206m) to Japan’s SMBC Aviation.

888 Holdings was the top performer on the FTSE 250 after saying that full-year adjusted underlying profits will be "significantly ahead of its prior expectations" as it continues to trade "well".

Tesco was a little weaker as it reported a 9.2% rise in UK and Ireland total first quarter sales, driven by a sharp increase in online shopping, but said it expects a £175m-£200m loss at its banking unit after increasing its potential bad debt provisions.

JD Sports was under the cosh, with traders pointing to read-across from disappointing quarterly results from Nike overnight.

In broker note action, InterContinental Hotels was boosted by an initiation of coverage at ‘buy’ by Peel Hunt, while Rentokil was up after an upgrade to ‘overweight’ at JPMorgan.

Shares of self-storage company Safestore were knocked lower by a downgrade to ‘hold’ at Berenberg, while housebuilder Crest Nicholson was lower after a downgrade to ‘hold’ at Jefferies. Rotork rallied after an upgrade to ‘outperform’ at Exane.

Market Movers

FTSE 100 (UKX) 6,212.07 1.06%
FTSE 250 (MCX) 17,225.43 0.66%
techMARK (TASX) 3,731.13 0.84%

FTSE 100 - Risers

International Consolidated Airlines Group SA (CDI) (IAG) 235.20p 3.57%
Rentokil Initial (RTO) 515.00p 3.06%
Smiths Group (SMIN) 1,287.50p 2.92%
Whitbread (WTB) 2,201.00p 2.85%
InterContinental Hotels Group (IHG) 3,653.00p 2.58%
Ferguson (FERG) 6,460.00p 2.57%
Melrose Industries (MRO) 116.30p 2.38%
RSA Insurance Group (RSA) 424.60p 2.09%
Burberry Group (BRBY) 1,543.50p 2.08%
Sage Group (SGE) 673.80p 2.06%

FTSE 100 - Fallers

JD Sports Fashion (JD.) 613.60p -3.43%
Tesco (TSCO) 223.40p -1.33%
Sainsbury (J) (SBRY) 203.20p -1.17%
National Grid (NG.) 968.60p -0.47%
Next (NXT) 4,803.00p -0.39%
DCC (DCC) 6,784.00p -0.15%
Royal Bank of Scotland Group (RBS) 120.05p -0.12%
British Land Company (BLND) 389.20p 0.03%
HSBC Holdings (HSBA) 384.95p 0.16%
Land Securities Group (LAND) 568.00p 0.18%

FTSE 250 - Risers

888 Holdings (888) 167.00p 10.60%
Calisen (CLSN) 199.70p 7.34%
Carnival (CCL) 1,014.00p 4.49%
Weir Group (WEIR) 1,075.50p 4.11%
Rotork (ROR) 282.80p 3.74%
easyJet (EZJ) 694.00p 3.58%
Essentra (ESNT) 303.00p 2.99%
Kainos Group (KNOS) 734.00p 2.95%
Impax Environmental Markets (IEM) 322.00p 2.88%
Big Yellow Group (BYG) 1,005.00p 2.71%

FTSE 250 - Fallers

Aston Martin Lagonda Global Holdings (AML) 58.60p -6.09%
Safestore Holdings (SAFE) 686.00p -4.52%
Telecom Plus (TEP) 1,404.00p -2.90%
Cairn Energy (CNE) 114.90p -2.63%
Crest Nicholson Holdings (CRST) 214.40p -2.46%
Airtel Africa (AAF) 58.70p -1.51%
Oxford Instruments (OXIG) 1,386.00p -1.42%
St. Modwen Properties (SMP) 328.00p -1.35%
Convatec Group (CTEC) 203.20p -0.97%
Drax Group (DRX) 223.80p -0.97%