FTSE 100 back on the front foot as Biden inauguration gets underway

Wed, 20th Jan 2021

The FTSE 100 managed modest gains by the close on Wednesday as incoming president Joe Biden prepared to deliver his inaugural address. There were larger gains in the US where the S&P 500 was up more than 1% to 3,838.64 by 4.30pm UK time with focus on the potential spending spree being lined up by the new administration. In a busy day for the mining sector, BHP firmed 2.9% to £21.72 after it reported a 3% rise in fourth-quarter iron ore output on a year-on-year basis, plus higher production of copper, offset by lower oil and gas output. BHP also upped its iron ore production guidance for 2021, narrowed its copper guidance and cut its energy coal guidance. Copper miner Antofagasta gained 1.4% to £15.32 as it said it had met full-year production guidance, while maintaining its output guidance for 2021. Fellow resources group Hochschild Mining rallied 6.1% to 205.4p, having forecast increased production for 2021 after 2020 output came in at the higher end of its revised forecasts. Elsewhere, luxury fashion retailer Burberry gained 3.5% to £17.99, despite reporting a 9% fall in third-quarter comparable store sales pinned, in part, on reduced tourist traffic. Asia Pacific, however, was a bright spot for the company, with comparable store sales there rising 11%, offsetting drops in Europe and the US. Educational publisher and services group Pearson climbed 8.1% to 734.2p even as it forecast a substantial drop in annual earnings as the pandemic kept many students away from classes, hurting sales. Pearson's adjusted operating profit for the year through December was expected in the range of £310 million-to-£315 million, compared to £581 million year-on-year. Revenue slumped 10% but, in a more positive sign, grew 4% in the fourth quarter. Book, stationary and convenience retailer WH Smith jumped 9.7% to £17.05 despite reporting a drop in revenue after its once-booming travel division was battered by border closures owing to the pandemic. WH Smith, however, said it had generated more cash than hoped in November and December due to better-than-expected high-street trading in the Christmas period. Specialised products and services supplier Diploma moved 6.3% higher to £22.66 on announcing that its revenue increased 24% in the first quarter, driven by a strong showing from recently acquired business Windy City Wire. Workspace rental group IWG reversed 3.3% to 324p after it warned its anticipated recovery in 2021 would be delayed by the pandemic and related lockdowns. IWG said revenue for the year ended 31 December was anticipated to be about £2.45 billion, down from £2.65 billion in 2019. Power company Aggreko gained 5.5% to 674.5p having guided for annual pre-tax profit 'slightly ahead' of the top end of its previous guidance range of £80-to-£100 million. Russia-focused gold miner Petropavlovsk added 3.4% to 32.4p on announcing that 'a lack of co-operation' from some senior employees was being positively resolved. The company, which recently underwent a board and management overhaul, had in October reported issues with 'a small group of senior employees' and ongoing legal issues. Professional services firm RPS was up 2.8% to 80p despite stating that it won't pay a dividend for 2020 after its quarterly fee revenue slipped 12% in constant currency. RPS added that it anticipated resuming dividends for 2021, providing markets continued to recover. Story provided by StockMarketWire.com

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