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London midday: Stocks extend gains as investors eye Biden’s package

(Sharecast News) – London stocks had extended gains by midday on Thursday as investors waded through a deluge of corporate releases, amid expectations that US President-elect Joe Biden will unveil a Covid-19 relief package.
The FTSE 100 was up 0.6% at 6,786.68, with Biden set to announce a $2 trillion relief bill, according to reports. This comes after Donald Trump was impeached for the second time, for inciting violence at the Capitol Hill riots.

IG market analyst Chris Beauchamp said: “A more positive tone in markets has developed ahead of the expected stimulus announcement from Joe Biden, investors hoping that the president-elect will move quickly and in substantial form to secure a new package that will bolster the US economy as the vaccine programme moves into a higher gear.

“The week has seen little real movement across most markets, the small bounce in the dollar notwithstanding, and the hope for traders will be that the Biden news will at least inject some more excitement into what has been a dull few days for markets. The impeachment of the sitting president has been mostly ignored, investors remembering that an actual Senate trial is unlikely to start before Biden’s inauguration, although the risk of civil unrest cannot be discounted.”

On the corporate front, investors were sinking their teeth into a raft of updates, with Tesco, Taylor Wimpey, Associated British Foods and Whitbread among the big names reporting.

Taylor Wimpey rallied after the housebuilder said its 2020 results will be in line with market expectations despite the impact of the pandemic. Peers followed suit, with Persimmon and Barratt Developments higher.

Persimmon was also boosted by positive comments from broker Liberum, which said it was its preferred large cap housebuilder, as it likes its exposure to lower price points, the north, first-time buyers and its strong balance sheet and dividends.

Premier Inn owner Whitbread was the top gainer on the FTSE 100 despite a downbeat update in which it warned of a “challenging” trading environment, after the latest round of lockdown restrictions caused accommodation sales to plummet by more than half.

Traders suggested the positive reaction could be down to news that Whitbread now plans to cut around 1,500 jobs from its hotel and restaurant operations, versus pervious indications that 6,000 jobs would be lost.

Just Group surged to the top of the FTSE 250 after it said retirement income sales for 2020 rose 12% to £2.15bn, driven by record transactions for defined benefit pensions.

Food packing company Hilton Food was also a high riser after saying it has performed ahead of its expectations as it continues from a shift to home consumption amid the Covid crisis.

AB Foods was little changed after it said Primark will lose an extra £355m in sales due under new restrictions to control the spread of Covid-19 in the UK.

Meanwhile, Tesco nudged lower as it stuck to its guidance for annual results after a 6.8% increase in Christmas sales helped offset an £85m increase in Covid-19 related costs. The company said retail operating profit is likely to be at least the same as in 2019-20 excluding the cost of repaying business rates relief.

Dunelm slid as it reported a spike in second-quarter sales, boosted by strong demand for homewares, but warned of a more uncertain outlook following the latest round of lockdown restrictions.

Elsewhere, B&M European Value Retailer, Sage and SSE were all weaker as their stock went ex-dividend.

Market Movers

FTSE 100 (UKX) 6,786.68 0.61%
FTSE 250 (MCX) 20,809.95 0.94%
techMARK (TASX) 4,140.52 0.67%

FTSE 100 – Risers

Whitbread (WTB) 3,191.00p 4.28%
Persimmon (PSN) 2,696.00p 3.22%
BHP Group (BHP) 2,186.00p 2.73%
Land Securities Group (LAND) 669.60p 2.62%
Barratt Developments (BDEV) 692.80p 2.61%
International Consolidated Airlines Group SA (CDI) (IAG) 156.30p 2.49%
Rio Tinto (RIO) 6,132.00p 2.30%
Rolls-Royce Holdings (RR.) 108.00p 2.27%
Anglo American (AAL) 2,787.00p 2.26%
Taylor Wimpey (TW.) 164.50p 2.17%

FTSE 100 – Fallers

B&M European Value Retail S.A. (DI) (BME) 528.40p -3.96%
SSE (SSE) 1,539.50p -2.35%
Sage Group (SGE) 554.40p -1.98%
Pennon Group (PNN) 965.20p -1.53%
Experian (EXPN) 2,699.00p -1.28%
Bunzl (BNZL) 2,460.00p -1.24%
Rentokil Initial (RTO) 527.20p -1.09%
Auto Trader Group (AUTO) 580.80p -1.06%
Avast (AVST) 529.50p -1.03%
Intermediate Capital Group (ICP) 1,722.00p -0.98%

FTSE 250 – Risers

Just Group (JUST) 80.85p 17.26%
Hilton Food Group (HFG) 1,192.00p 5.49%
Tritax Big Box Reit (BBOX) 177.00p 5.17%
Greencore Group (GNC) 111.00p 4.82%
Hammerson (HMSO) 23.42p 4.69%
Micro Focus International (MCRO) 415.00p 4.46%
easyJet (EZJ) 796.20p 4.38%
Greggs (GRG) 1,876.00p 4.16%
Shaftesbury (SHB) 552.50p 4.15%
Hays (HAS) 147.10p 4.03%

FTSE 250 – Fallers

Dunelm Group (DNLM) 1,201.00p -7.33%
Aston Martin Lagonda Global Holdings (AML) 1,592.00p -3.63%
Wood Group (John) (WG.) 341.80p -3.26%
Elementis (ELM) 111.90p -2.70%
Ferrexpo (FXPO) 336.20p -2.10%
Diploma (DPLM) 2,098.00p -1.96%
Centamin (DI) (CEY) 120.85p -1.83%
Vivo Energy (VVO) 81.00p -1.82%
Network International Holdings (NETW) 341.00p -1.62%
Hochschild Mining (HOC) 203.20p -1.45%

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