ADVFN Morning London Market Report: Monday 1 March 2021

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London open: Stocks rise as bond markets stabilise; housebuilders rally

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London stocks rose in early trade on Monday as bond markets recovered, with housebuilders pacing the advance.

At 0835 GMT, the FTSE 100 was up 1.3% at 6,569.32.

Richard Hunter, head of markets at Interactive Investor, said: “There has been a pause for breath after the bond market sell-off stabilised, although inflation concerns remain near the surface.

“Those fears of inflation have certainly not gone away but attention has shifted back, perhaps temporarily, to the immediate positive drivers which could propel a strong economic rebound.

“More generally, the success so far of the vaccine rollouts and the pent-up consumer demand which has partly been due to enforced savings are preparing the ground for a spending spree later in the year. In the US, the increasing likelihood of the President’s proposed stimulus package could initiate a strong road to recovery.”

In equity markets, housebuilders were the standout gainers, with PersimmonTaylor Wimpey and Barratt Developments all sharply higher on news that Chancellor Rishi Sunak will unveil in his Budget this week a mortgage guarantee scheme to help first-time buyers.

As part of the scheme, the government will offer incentives to lenders which would mean that people would be able to buy properties worth up to £600,000 with a deposit of just 5%.

Elsewhere, AstraZeneca was also up following a report that it has sold its entire stake in Moderna for more than $1bn.

Ladbrokes owner Entain pushed higher after it raised its offer for Swedish rival Enlabs to SEK53 from SEK40.

Distribution group Bunzl fell even after it reported a rise in annual profit and increased its dividend as deliveries of Covid safety equipment offset a fall in business from the food and retail sectors.

 

Top 10 FTSE 100 Risers

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# Name Change Pct Change Cur Price
1 Carnival Plc +6.57% +103.50 1,679.00
2 Persimmon Plc +5.95% +154.00 2,744.00
3 Taylor Wimpey Plc +5.43% +8.55 166.15
4 Tui Ag +5.30% +22.90 454.70
5 International Consolidated Airlines Group S.a. +4.98% +9.55 201.50
6 Barratt Developments Plc +4.43% +29.40 693.80
7 Scottish Mortgage Investment Trust Plc +4.32% +49.00 1,184.00
8 Berkeley Group Holdings (the) Plc +4.07% +165.00 4,218.00
9 Easyjet Plc +3.95% +38.90 1,024.50
10 Rightmove Plc +3.93% +22.20 587.20

 

Top 10 FTSE 100 Fallers

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# Name Change Pct Change Cur Price
1 Bunzl Plc -1.65% -37.00 2,200.00
2 Informa Plc -0.54% -3.00 547.80
3 Just Eat Plc -0.00% -0.00 861.00
4 Nmc Health Plc -0.00% -0.00 938.40
5 London Stock Exchange Group Plc +0.00% +0.00 8,620.00
6 Royal Bank Of Scotland Group Plc +0.00% +0.00 120.90

 

Europe open: Shares open strongly as bond sell-off eases

European shares opened in bullish fashion on Monday as the bond market sell off eased and investors took heart from Covid vaccine rollouts, although inflationary fears persisted.

The pan-European Stoxx 600 index was up 1.54%, with all major regional bourses higher.

“Those fears of inflation have certainly not gone away but attention has shifted back, perhaps temporarily, to the immediate positive drivers which could propel a strong economic rebound,” said Richard Hunter at interactive investor.

“More generally, the success so far of the vaccine rollouts and the pent-up consumer demand which has partly been due to enforced savings are preparing the ground for a spending spree later in the year.”

“In the US, the increasing likelihood of the President’s proposed stimulus package could initiate a strong road to recovery.”

Hopes that UK Finance Minister Rishi Sunak would unveil measures to buy homes buyers boosted house builders with Persimmon, Taylor Wimpey, Barratt, Vistry and Bellway all gaining.

 

Monday newspaper round-up: Uber, hospitality reopening, Spacs

Uber has been accused of using “loaded questions” in a consultation with drivers, after a landmark court ruling handed workers rights to improved conditions. The firm may have to pay out over £100m in compensation to 10,000 drivers, after the UK supreme court ruled last week they are entitled to holiday pay, a company pension and the national minimum wage. Uber has previously argued that its 60,000 UK drivers are self-employed independent contractors with limited employment rights. – Guardian

A British private investigator and security consultant whose company has just completed a four-year contract to protect the UK’s embassy in Tel Aviv is linked to a string of telecommunications hacking complaints dating back more than 20 years, according to high court judgments. A court judgment that touches on the career history of Stuart Page – the 69-year-old founder of the private security and intelligence firm Page Group – noted last May that the businessman “operates in a world of covert surveillance in which agents acquire confidential information unlawfully”. – Guardian

The delayed reopening of hospitality will cost the sector £9bn, bosses have warned, as MPs demanded the Chancellor ramp up support for businesses at the Budget on Wednesday. In a letter sent to Rishi Sunak, a group of 80 MPs warned that pubs, restaurants and hotels have been “ravaged” by the coronavirus crisis and urged the Chancellor to invest in the sector to support the recovery. New figures by trade body UKHospitality revealed that the delayed reopening of businesses would cost £9bn in lost sales and other costs compared with reopening from April 1 and lifting all restrictions by June 21. – Telegraph

AstraZeneca has sold its stake in Moderna for more than $1 billion after the American biotechnology company’s shares soared on the back of its coronavirus vaccine breakthrough. The British-based drugs company has disposed of its 7.7 per cent holding, which had made it Moderna’s second largest investor last year. – The Times

Warren Buffett’s right-hand man has had enough of Wall Street’s latest craze. The world “would be better off without” blank-cheque companies, Charlie Munger declared last week. No matter that the boom surrounding such special purpose acquisition companies – “Spacs” in the vernacular – is continuing, with more shell vehicles landing on the American stock market every day. – The Times

 

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