(Sharecast News) – London stocks were still in the red by midday on Monday amid reports that Covid-19 restrictions in England were set to get even tougher.
The FTSE 100 was down 0.5% at 6,840.78, while sterling was 0.5% weaker versus the dollar at 1.3501.
Investors were digesting reports over the weekend that the government is considering tightening restrictions even further, with masks in certain outdoor settings, curfews and even a ban on people leaving the house more than once a week said to have been discussed.
Spreadex analyst Connor Campbell said: “Without the artificial buzz of the New Year, or a seismic event like a pair of Senate races, the markets were forced to contend with the day-to-day realities of trading in 2021.
“For the FTSE, that means the prospect of even tighter restrictions in the UK, as experts believe the current level of lockdown isn’t having the desired effect. Practically, any further measures the government could implement should have minimal impact on the blue chip index’s individual components. Symbolically, however, the shift towards harsher constraints may undermine the FTSE’s recent growth.”
Campbell said things could get worse this afternoon if Europe takes its cues from the US, with futures pointing to a lower open.
“Part of that will be a natural reaction to its recent record-breaking gains; and part of it will come from anxiety over the tinderbox political situation domestically,” he said.
“The Democrats are moving to try and impeach Donald Trump before Joe Biden’s inauguration on January 20th. And while that won’t have too much of an effect on actual governance – something Trump hasn’t been interested in since November anyway – it is indicative of an unstable, and potentially violent, few months in America.”
In equity markets, Smith & Nephew fell after the medical technology company said it expects to report a 7% decline in fourth-quarter underlying revenue and a 12% drop in full-year revenues, as more medical procedures are postponed due to rising numbers of coronavirus infections.
British Land lost ground after saying that on 7 January, it had collected 71% of rent due for payment in the December quarter comprising 99% of office rents and 46% of retail rents.
Ladbrokes owner Entain declined after its chief executive quit, with the company a takeover target for MGM Resorts International.
Travel and leisure stocks also took a hit amid the prospect of tighter restrictions, with TUI, Cineworld and Mitchells & Butlers all lower.
Budget airline easyJet flew a little lower after strengthening its balance sheet by signing a new five-year $1.87bn (£1.4bn) term loan facility to help it deal with the continuing impact of the coronavirus pandemic.
On the upside, JD Sports rallied after saying it was confident headline pre-tax profit for the year to 30 January 2021 will be “significantly” ahead of current market expectations of around £295m as demand has remained robust throughout the second half.
On the FTSE 250, Signature Aviation surged after Gatwick Airport co-owner Global Infrastructure Partners has swooped to buy the company for $4.63bn (£3.43bn), beating a rival offer from private equity outfit Blackstone Group and Microsoft founder Bill Gates.
Chemring was boosted by an upgrade to ‘buy’ at Peel Hunt.
Market Movers
FTSE 100 (UKX) 6,840.78 -0.47%
FTSE 250 (MCX) 21,000.27 -0.30%
techMARK (TASX) 4,193.27 0.09%
FTSE 100 – Risers
JD Sports Fashion (JD.) 885.40p 4.07%
B&M European Value Retail S.A. (DI) (BME) 556.60p 2.20%
Pershing Square Holdings Ltd NPV (PSH) 2,730.00p 1.87%
Ocado Group (OCDO) 2,526.00p 1.81%
Just Eat Takeaway.Com N.V. (CDI) (JET) 9,148.00p 1.73%
AstraZeneca (AZN) 7,581.00p 1.47%
London Stock Exchange Group (LSE) 9,338.00p 1.43%
Morrison (Wm) Supermarkets (MRW) 185.15p 1.40%
Aveva Group (AVV) 3,567.00p 1.02%
Vodafone Group (VOD) 129.56p 0.87%
FTSE 100 – Fallers
BHP Group (BHP) 2,170.00p -2.32%
British Land Company (BLND) 454.60p -2.26%
Anglo American (AAL) 2,764.00p -2.09%
Melrose Industries (MRO) 182.30p -2.02%
Informa (INF) 554.80p -2.01%
Compass Group (CPG) 1,446.00p -1.87%
Land Securities Group (LAND) 671.10p -1.76%
Rolls-Royce Holdings (RR.) 105.45p -1.72%
Barratt Developments (BDEV) 707.80p -1.69%
Coca-Cola HBC AG (CDI) (CCH) 2,390.00p -1.69%
FTSE 250 – Risers
Signature Aviation (SIG) 441.70p 8.79%
Chemring Group (CHG) 312.00p 4.52%
Network International Holdings (NETW) 344.60p 3.61%
Premier Foods (PFD) 110.20p 3.38%
XP Power Ltd. (DI) (XPP) 5,240.00p 3.15%
ITV (ITV) 112.45p 2.23%
Synthomer (SYNT) 460.00p 2.18%
Hilton Food Group (HFG) 1,108.00p 2.03%
Ultra Electronics Holdings (ULE) 2,066.00p 1.97%
Spirent Communications (SPT) 264.50p 1.93%
FTSE 250 – Fallers
TUI AG Reg Shs (DI) (TUI) 357.70p -5.87%
Cineworld Group (CINE) 65.52p -5.51%
Aston Martin Lagonda Global Holdings (AML) 1,703.40p -4.60%
Hammerson (HMSO) 22.92p -4.50%
National Express Group (NEX) 252.80p -4.24%
FirstGroup (FGP) 77.00p -3.57%
Micro Focus International (MCRO) 412.10p -3.31%
Essentra (ESNT) 321.20p -2.96%
Indivior (INDV) 102.20p -2.76%
Liontrust Asset Management (LIO) 1,285.00p -2.65%
