- FTSE 100 up 36 points
- London restaurants fully booked
- US stocks mixed
12.05pm: Gains made across Europe and in the US
The FTSE 100 ended Friday up 36 points, 0.5%, at 7,020, while the FTSE 250 picked up 50 points, 0.2%, to 22,522.
“US markets have seen a slight slowdown in the momentum of earlier in the week, but this has been compensated for by solid gains in European markets, which have woken up after a mixed week,” IG Chief Market Analyst Chris Beauchamp wrote. “… In London, while the FTSE 100 has been unable to match the bullishness of continental indices, it has nonetheless been supported by a wide range of stocks. This equity rally shows no sign of slowing, fortified by hopes of continued economic growth in coming quarters.”
Across the pond, the Dow gained 93 points, 0.3%, to 34,129 at midday, which would be another record high this week. The Nasdaq slipped 14 points, 0.1%, to 14,024, and the S&P 500 ticked up 7 points, 0.2%, to 4,177, also a record high, which would mark the fourth consecutive positive wek for the index.
Traders got more positive economic news Friday when the University of Michigan announced that its preliminary consumer sentiment index rose to 86.5 in the first half of April, a one-year high and up from 84.9 in March.
3.30pm: London set for exceptional weekend with restaurants fully booked
FTSE 100 held up before close and rose 32 points to 7,014.
Meanwhile, sterling clawed back earlier losses and added 0.2% to US$1.3818.
London’s West End is set for a weekend to remember as spending over the two and half days could top £300mln.
Almost every outdoor table in the Capital has booked from this evening until close Sunday, according to the Centre for Retail Research, with bookings even higher than last July when the ban on eating out after the first lockdown was lifted.
Bookings app TheFork said numbers are more than double this weekend than ‘Super Saturday’ a year ago.
The rest of the country has seen reservations jump by 105%, he added, though the acid test will be how many of those who have booked actually turn up.
The British Beer and Pub Association was also cautious saying that gardens are only around 25% of capacity and to be classed as fully booked need to be 80% filled.
2.42pm: Mixed open for Wall Street
The main indices on Wall Street got off to a mixed start on Friday, however recent strong economic data and a positive start to earnings season pushed the Dow to fresh highs in early trading.
Shortly after the opening bell, the Dow Jones Industrial Average was up 0.49% at 34,208, while the S&P 500 climbed 0.23% to 4,180. The Nasdaq was the negative outlier, falling 0.15% to 14,017.
Market sentiment is likely to have been helped by earnings from Morgan Stanley, which reported record first quarter profits that more than doubled year-on-year.
Back in London, the FTSE 100’s rally had lost a little steam into late afternoon, however, the blue-chip index was still up 28 points at 7,011 at 2.40pm.
2.20pm: Hammerson to cut rents for retail tenants to boost sector
FTSE 100 held its gains in the afternoon and surged 36 points to 7,019.
The landlord, which owns London’s Brent Cross, only collected 75% of rent due last year because of the economic damage suffered by brick’n’mortar shops during the pandemic.
“Typically, we’re resetting our rents to more affordable levels,” managing director of UK & Ireland Mark Bourgeois told the BBC.
“We are really doing our bit as are… all landlords to make sure we maintain vibrancy in these centres.”
He noted that the vaccine rollout has made people feel safer, while the sector will enjoy consumer confidence after UK residents have amassed more savings than usual during lockdowns.
“People just love to get out. You can only do so much online shopping [people want to] get out and feel the products and brands in real life,” Bourgeois said.
1.10pm: FTSE 100 far from all-time highs while US indices keep beating records
FTSE 100 stayed put in the early afternoon, up 35 points to 7,018.
While US indices have all reached record levels, London’s main index is lagging behind, having touched its all-time high of 7,877.45 nearly three years ago in May 2018.
Passing the 7,000 mark is nonetheless a significant milestone, experts say, as it edges closer to last February levels.
“Investor confidence in economic recovery is rising as Governments roll out stimulus packages and business confidence surveys are hitting highs,” said Steve Clayton, HL Select Fund Manager.
“Whether the FTSE can close the gap against US and European market indexes is another matter. The UK market has much bigger exposure to commodities and banking than Wall Street or Frankfurt, so the performance of those sectors will be key to the UK’s relative performance in the years ahead.”
FTSE 100 may have suffered because of its international focus, hammered by the pandemic, Brexit and sterling’s performance, while its cousin FTSE 250 is doing much better.
The index of mid-caps, which mostly includes domestic companies and investment trusts, has touched an all-time high of 22,538.37, from last February’s 21,780.2.
“Sentiment has been further boosted by a Brexit resolution which has seen domestically orientated names recover from very depressed levels,” said Jonathan Winton, portfolio manager at Fidelity UK Smaller Companies Fund.
“Despite the strong gains, the UK market continues to look very attractive compared to the US and European markets, trading on a 40% and 25% discount respectively. It continues to be one of the lowest rated markets globally, despite a relatively favourable economic growth outlook and greater Brexit clarity. Encouragingly, many UK companies are reporting strong trading whether they’re domestically or internationally exposed, and in that context, it’s hard to see why the UK discount should persist.”
12.10pm: Wall Street in for mixed open
FTSE 100 retraced a little at midday but was still up 36 points to 7,020.
Wall Street is headed for a mixed open, with the Dow Jones and S&P 500 called higher while the Nasdaq is expected to shed a few points.
According to analysts, the blowout US data on Thursday has improved the “risk-on” sentiment.
US retail sales came well above forecast, up 9.8% month-on-month, while jobless claims fell 168,000 instead of 44,000 as expected, though US Treasury yields fell 0.56%.
“Was it in continued reaction to the dovish comments from Fed Chair Powell and Vice Chair Clarida on Wednesday?,” said Marshall Gittler, Head of Investment Research at BDSwiss.
“Or the renewed demand from Japanese investors with the start of the new fiscal year, as I mentioned in yesterday’s comment? Plus earnings were generally good and forecasts revised up. The combination took US stocks higher to a new record high on the S&P 500 (but not yet on the NASDAQ, although it’s close).”
11.15am: Matt Hancock’s sister revealed to own shares in company contracted by NHS
FTSE 100 was on the rise in the late morning, climbing 48 points to 7,031.
Health Secretary Matt Hancock owns shares in a company that won a £300,000 contract with the NHS this year, it has emerged.
Last month, he declared that he owned over 15% of Topwood, which specialises in handling documents.
However, it was not mentioned that his sister Emily Gilruth also owns a stake and is a director of the firm, healthcare publication HSJ reported.
The government said Hancock acted “entirely properly” and “in accordance with the ministerial code”.
Labour MP Jonathan Ashworth tweeted “shocking but sadly I suspect no one is surprised any more at the cronyism at the heart of this government”.
9.45am: Crypto frenzy continues as Dogecoin nearly doubles in a day
FTSE 100 trimmed its gains in mid-morning, advancing 27 points to 7,010.
The market debut of Coinbase Global Inc (NASDAQ:COIN) has sparked a frenzy in cryptocurrency, with meme-inspired token Dogecoin rocketing 94% to US$0.2612 in a day.
Dogecoin was created in 2013 by two software engineers to be a payment system that reached a broader demographic and also a way to distance crypto from other controversial tokens such as Bitcoin.
The “unprecedented demand” caused issues on Robinhood overnight, but the trading platform had its crypto services fully restored by early morning.
Unsurprisingly, the surge was helped by Elon Musk’s endorsement on Twitter.
Doge Barking at the Moon pic.twitter.com/QFB81D7zOL
— Elon Musk (@elonmusk) April 15, 2021
Coinbase closed Thursday’s session at US$322.75, which gives it a market cap of US$65.3bn.
“Now, traditional asset managers inevitably question whether Coinbase’s market cap is worth more than the double of Nasdaq and New York Stock Exchange combined,” said Ipek Ozkardeskaya, Senior Analyst at Swissquote.
“Will traditional players go against the cryptocurrency exchange to defend their own interests and let the world know that the crypto-assets don’t have their place among them? It’s yet to be seen. But we may very well see the round two of the Retail versus Wall Street battle. Retail wanting a more affordable and democratized finance system, and Wall Street, well, willing to keep its main street dominance.”
8.40am: Ashmore an early riser despite funds fall
FTSE 100 crossed the 7,000 mark at open, buoyed by optimism in Asia after China’s economy surged 18.3% in the first quarter.
London’s main index jumped 35 points to 7,018, while sterling shed 0.3% to US$1.3737.
“The rollout of vaccine, economic recovery and policies remain the three major drivers that lead the market. When the liquidity driven valuation comes to an end, strategic focus should be put on periodic and structural opportunities of specific stocks,” said Lynda Zhou, Portfolio Manager at Fidelity International.
“Continuity of business performance may be a key factor in the bottom-up stock selecting approach and investors should give special focus to high-quality companies after the valuation correction. In terms of sectors, I am bullish on cyclical sectors that are supported by decent business performance, the consumption sector with stable business performance and the import substitution material and industrial sector that will benefit from a more centralized market.”
Back to the UK, FTSE 250-listed asset manager Ashmore PLC (LON:ASHM) added 2% to 426.1p after announcing that inflows into its equity funds helped reduce the impact of a tough period for debt and fixed income products in the three months to end-March.
Assets under management fell by US$3.1bn over the period to US$89.9bn, the group’s third quarter, comprising net inflows of US$1.5bn and a negative investment performance of US$4.6bn.
Fellow mid-cap Grafton Group PLC (LON:GFTU) remained flat at 1,103p after announcing it is mulling over the sale of some of its traditional merchanting businesses in the UK.
AFC Energy PLC (LON:AFC) is to deepen its relationship with ABB Schweiz AG, the provider of electric vehicle charge points, electrification and digitalisation technologies. As part of a £33.5mln fundraising by AFC, ABB will invest £3.25mln in AFC and the two will work together on integrating AFC’s alkaline fuel cell technology into ABB’s data centres offering.
Powerhouse Energy Group PLC (LON:PHE) said James Greenstreet will retire as a director on July 7 and that it intends to appoint another non-executive director in due course. “We are very grateful to James who has completed a decade of great service to Powerhouse during which the company has made enormous progress. We wish him every success in the future with his other activities”, executive chairman Tim Yeo said in a statement.
Love Hemp Group PLC (LON:LIFE) (OTCQB:WRHLF) said non-executive independent director Charles Lamb will be stepping down from the company to focus on other business interests. “Charles has made a significant contribution to the Company over a period of successful growth and refocussing. On behalf of the board, I would like to thank him for all his efforts and support and wish him the best with future endeavours. As we move towards a listing on the [LSE] Main Market, we will be looking to strengthen our board with those who are able to provide experience and guidance to support our future growth”, Love Hemp chairman Andrew Male said in a statement.
Power Metal Resources PLC (LON:POW) said its CEO Paul Johnson purchased on market 500,000 ordinary shares at a price of 2.39p each through his Self-Invested Personal Pension (SIPP), £11,957 invested in total.
6.35am: FTSE 100 to edge cautiously towards 7,000
US indices may have rocketed to new highs yesterday but in London, the FTSE 100 is edging arthritically towards 7,000.
Spread betting quotes suggest London’s index of leading shares won’t pass that particular milestone at the open, as it is tipped to start just 8 points higher at 6,992.
Stateside, the Dow Jones average shot up 305 points to 34,036 while the S&P 500 surged 46 points to close at 4,170.
In Hong Kong, the Hang Seng index is 25 points firmer at 28,818 after some underwhelming gross domestic product data (GDP) from China.
China’s first-quarter GDP was up 18.3% year-on-year but this was right at the lower end of the range of forecasts from economists.
“High GDP growth in 1Q21 was a mix of base effects and genuine recovery. Without such base effects, China’s GDP growth will appear more moderate over the rest of the year. Activity data shows that China is on a recovery path. The main risk concerns chip shortages, which could limit production and export growth in the coming quarters.,” ING said.
In Tokyo, the Nikkei 225 is 29 points to the good at 29,672.
Ashmore will focus on assets under management (AuM), which increased 11% to US$93bn in the six months to December, helped by significant market outperformance across fixed income and equities.
Investors will want to hear how the company is dealing with operating costs after the asset manager previously said it focused on managing them to keep profits high.
The company is also looking to diversify its investment capabilities and to grow the scale of its local asset management platforms.
Around the markets
- Sterling: US$1.3763, down 0.19 cents
- 10-year gilt: 0.739%, down 6.73 basis points
- Gold: US$1,764.60 an ounce, down US$2.20
- Oil: US$67.06 a barrel, up 12 cents
- Bitcoin: US$62,076, down US$1,305
6.50am: Early Markets – Asia / Australia
Stocks in the Asia-Pacific region were mostly higher on Friday as China’s GDP surged 18.3% in the first three months of the year from a year ago.
The growth was slightly lower than expectations for a 19% increase, according to analysts polled by Reuters.
The Hang Seng index in Hong Kong rose 0.32% while the Shanghai Composite in China gained 0.63%.
In Japan, the Nikkei 225 advanced 0.11% while South Korea’s Kospi rose 0.16%.
Shares in Australia were below the flatline, with the S&P/ASX 200 trading 0.11% lower.
Proactive Australia news:
Queensland Pacific Metals Ltd (ASX:QPM) (FRA:4EA) has completed successful bench-scale test-work to produce nickel sulphate from the nickel-cobalt mixed hydroxide precipitate (MHP) produced at its pilot plant operations.
Twenty Seven Co Ltd’s (ASX:TSC) (FRA:U9V) review of historical soil geochemistry, combined with the reprocessing of open file historical geophysical surveys, has confirmed the presence of favourable structural settings at Yarbu Gold Project which warrant first-pass exploration investigation.
Corazon Mining Ltd‘s (ASX:CZN) first phase 2021 drilling campaign at Lynn Lake Nickel-Copper-Cobalt Sulphide Project in Manitoba Province, Canada, has intersected favourable host rocks and extensive indications of magmatic nickel-copper sulphide mineralisation.
Theta Gold Mines Ltd (ASX:TGM) (OTCMKTS:TGMGF) looks set to become a key player in the South African mining industry through plans to begin operations at open pit and underground mines in the Eastern Transvaal Gold Fields.
FYI Resources Ltd (ASX:FYI) recently released an updated DFS for its Cadoux Kwinana HPA Project, with outstanding project economics that further improve what was already a robust case, according to Foster Stockbroking.