ADVFN Morning London Market Report: Tuesday 17 November 2020

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London open: Stocks edge lower as vaccine optimism fades


London stocks edged lower in early trade on Tuesday as vaccine optimism faded, with worries about rising Covid-19 cases and the impact of tighter restrictions continuing to play on investors’ minds.

At 0850 GMT, the FTSE 100 was down 0.3% at 6,405.35.

Spreadex analyst Connor Campbell said: “A ripple of tighter lockdown restrictions in Europe forced investors to consider the pandemic present rather than the vaccine future on Tuesday.

“It seems like the Moderna news doesn’t have quite the same legs as the initial Pfizer/BioNTech announcement, though the latter vaccine update did also have the benefit of coming in the swell of Biden election win gains.

“Nevertheless the markets losses were on the lower end of the spectrum, a barely perceptible retreat compared to the bounding growth of the last couple of weeks.”

In equity markets, stocks that rose in the vaccine-fuelled rally gave back some gains, with Premier Inn owner Whitbread, caterer Compass Group and engine maker Rolls-Royce all down.

Budget airline easyJet flew lower after saying it swung to a massive £1.3bn annual loss, revealing the full extent of the havoc caused by the coronavirus pandemic as capacity almost halved. The pre-tax loss compares with a £430m profit a year ago.

On the upside, Intermediate Capital rallied as it posted a sharp rise in first-half profits amid strong demand for its funds and a recovery in portfolio valuations across the period.

Homeserve was also on the front foot after saying it expects to deliver group profit before tax and appreciation for FY21 slightly ahead of current consensus estimates.

Aggreko pushed higher as the temporary power provider said full-year profit is expected to be at the upper end of its previous guidance following some recovery in most of its markets, and set its profit guidance for 2021.

In broker note action, Avast was boosted by an upgrade to ‘buy’ at Citi, while Upper Crust owner SSP and WH Smith were both weaker after downgrades at Morgan Stanley and RBC Capital Markets, respectively.

Petrofac was knocked lower by a downgrade to ‘reduce’ at HSBC.


Top 10 FTSE 100 Risers

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76.4% of retail CFD accounts lose money.


# Name Change Pct Change Cur Price
1 Ocado Group Plc +3.52% +77.00 2,266.00
2 Imperial Brands Plc +3.10% +43.50 1,446.00
3 Fresnillo Plc +2.32% +25.50 1,125.00
4 Rentokil Initial Plc +1.65% +8.60 530.80
5 Hargreaves Lansdown Plc +1.58% +25.00 1,608.00
6 Scottish Mortgage Investment Trust Plc +1.47% +15.00 1,038.00
7 Segro Plc +1.38% +12.40 909.20
8 Intertek Group Plc +1.30% +80.00 6,230.00
9 Experian Plc +1.20% +36.00 3,031.00
10 Taylor Wimpey Plc +1.13% +1.70 152.00


Top 10 FTSE 100 Fallers

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76.4% of retail CFD accounts lose money.


# Name Change Pct Change Cur Price
1 Easyjet Plc -4.32% -33.60 744.00
2 Rolls-royce Holdings Plc -3.34% -3.44 99.56
3 Carnival Plc -3.01% -36.50 1,176.00
4 Melrose Industries Plc -2.88% -4.65 156.55
5 Vodafone Group Plc -2.75% -3.52 124.26
6 Compass Group Plc -2.54% -36.00 1,380.00
7 Whitbread Plc -2.10% -64.00 2,990.00
8 Land Securities Group Plc -2.06% -14.60 694.30
9 Tui Ag -2.04% -8.50 407.80
10 Bt Group Plc -1.84% -2.35 125.15


Tuesday newspaper round-up: Heathrow, boardroom pay, The Hut Group

The government is exploring options for dealing with a £40bn black hole in the public finances, which would result from a proposed ban on the sale of new petrol and diesel cars within a decade. Boris Johnson is expected to announce this week the cut-off date for the ban will be brought forward by five years to 2030, in a step designed to underscore the government’s commitment to a green economic recovery from the coronavirus pandemic.- Guardian

Workers at Heathrow are to strike for four days in December over “fire and rehire” plans that have cut the wages of long-serving staff, in an increasingly bitter dispute. The Unite union said the action by frontline employees would effectively close London’s main airport for periods in the run-up to Christmas, although Heathrow said it would keep operating despite the strikes. – Guardian

A top business lobby group has said that new security laws restricting foreign takeovers risk creating a “chilling effect” on investment in the British economy. The Institute of Directors (IoD) warned that proposals to force foreign investors in UK companies or assets to get government approval for transactions could stifle growth by damaging the country’s reputation as a good place to do business. – Telegraph

Companies face renewed pressure to rein in excessive boardroom pay after a powerful investor group said it would single out businesses that handed bosses exorbitant pensions and warned against big post-pandemic bonuses. The Investment Association urged companies yesterday to bring the retirement benefits that their bosses receive into line with the arrangements for the majority of their workforces. – The Times

The founder of The Hut Group is to receive one of the biggest payouts in UK corporate history after the recently listed online retailer’s share price rose sharply. Matthew Moulding, 48, who started the technology company in 2004, will receive at least £830 million in stock after the share price rose to hit its target, set out when it floated on the London Stock Exchange in September at 500p a share and a value of £5.4 billion. – The Times


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