23rd Jun 2020 09:08
(Alliance News) - Stock prices in London opened higher on Tuesday following conflicting trade signals from the US overnight, with investors hopeful the latest purchasing managers' index readings will point to a recovery.
The FTSE 100 index was up 45.73 points, or 0.7%, at 6,290.35. The mid-cap FTSE 250 index was up 171.04 points, or 1.0%, at 17,744.84. The AIM All-Share index was up 4.01 points, or 0.5%, at 894.72.
The Cboe UK 100 index was up 0.3% at 10,599.43. The Cboe 250 was up 0.3% at 15,154.10, and the Cboe Small Companies was up 0.1% at 9,756.59.
In Paris the CAC 40 index was up 0.5%, while the DAX 30 in Frankfurt was up 0.7%.
The Nikkei 225 index in Tokyo closed up 0.5%. The Shanghai Composite closed up 0.2%, while the Hang Seng index in Hong Kong is up 0.9%.
Stock prices in Asia endured a volatile session after top White House economics adviser Peter Navarro said on Monday that the US-China trade pact signed in January was "over", fanning fears of a renewed trade war and sparking an equity sell-off. Navarro quickly backtracked on his stance saying his comments were taken out of context.
Trump later tweeted: "The China Trade Deal is fully intact. Hopefully they will continue to live up to the terms of the Agreement!"
London Capital Group's Jasper Lawler said: "Navarro's fluffed interview answer served as a useful beta test for how relevant the US-China trade deal still is for markets, even among all the concerns over the coronavirus. The markets have continued to sing an optimistic tune despite souring relations between the US and China. This wobble overnight demonstrates that optimism rests on the idea that souring relations won't threaten the phase one deal."
In the FTSE 100, St James's Place was up 1.0% after the wealth manager said new business inflows and funds under management remain "robust", despite a volatile market environment.
Funds under management stood at GBP112.58 billion on May 31, up 6.4% from GBP105.83 billion at the same time last year. Net inflows during the first five months of 2020 were GBP3.85 billion, up from GBP3.71 billion. Net inflows for May totalled GBP670 million, down from GBP730 million.
St James's Place said funds under management benefited from the retention of existing client investments and a recovery in world stock markets. It said its annualised retention rate has improved to 96.4% so far in 2020, up from 95.9% a year ago.
At the other end of the large-cap index, Hikma Pharmaceuticals was the worst performer, down 7.4% at 2,293.00 pence. Boehringer Ingelheim Invest sold 27.2 million shares in the drugmaker at 2,300p each, and Hikma also will buy back 12.8 million shares owned by Boehringer at the same price, JPMorgan Securities said.
The sale price was a 7.3% discount to Hikma's closing price of 2,480 pence on Monday.
The US bank said late Monday that Boehringer would sell 28 million Hikma shares via a bookbuild, and as part of the deal Hikma would buy up to GBP295 million of shares from Boehringer.
Following the sale, Boehringer no longer owns any shares in Hikma.
Ocado Group was down 4.4% despite the online grocer surging to its highest ever UK market share. Ocado achieved a market share of 1.7%, its best ever in Kantar survey history. The online-only grocer, benefiting from UK consumers doing their shopping from home, saw sales jump 42% year-on-year during the 12 weeks to GBP520 million.
Among the "Big Four" UK grocers, Tesco's market share dipped to 26.9% from 27.3%. This was despite sales rising 12% annually to GBP8.41 billion.
J Sainsbury's market share also slipped, to 14.9% from 15.3%, but it similarly booked a double-digit annual sales rise. Sales were up 10% to GBP4.65 billion.
Wm Morrison Supermarkets' sales rose 10% as well, to GBP3.17 billion, and its market share fell to 10.1% from 10.4%.
Shares in Sainsbury's were down 2.0%. Morrison's shares were down 0.7%, and Tesco's were down 1.5%.
The pound was quoted at USD1.2473 Tuesday morning, up from USD1.2441 at the London equities close Monday, ahead of PMI data at 0930 BST.
The UK services PMI reading is expected to rise to 40.0 in June from 29.0 in May.
The euro stood at USD1.1286, up from USD1.1253 at the European equities close Monday, after positive PMI data from the continent.
Germany's flash composite purchasing managers' index, which tracks both the manufacturing and services sectors, improved to 45.8 in June from 32.3 in May. The figure beat the consensus estimate of 44.2.
Against the yen, the dollar was trading at JPY107.12 in London, up from JPY106.85 late Monday.
Brent oil was quoted at USD42.94 a barrel Tuesday morning, up from USD42.58 at the close Monday. Gold was at USD1,750.11 an ounce, lower against USD1,757.90 late Monday.
Ahead in the economic calendar other than the UK PMI reading, there are US manufacturing and services PMI readings at 1445 BST.
By Arvind Bhunjun; [email protected]
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TescoHikma PharmaceuticalsMRW.LSt James's PlaceSainsbury's