(Sharecast News) – London stocks had fallen into the red by midday on Thursday, unable to hold on to earlier gains, after Joe Biden was confirmed by Congress as the 46th President of the US.
The FTSE 100 was down 0.4% at 6,817.54, having started the day higher despite overnight chaos on Capitol Hill.
Richard Hunter, head of markets at Interactive Investor, said a Democrat-controlled Senate was “something of a double-edged sword”.
“On the one hand, the new balance of power is largely expected to result in increased fiscal stimulus and infrastructure spending, but it may also be accompanied by higher taxes and regulation,” he said.
On home shores, meanwhile, a survey showed that house building underpinned the UK construction sector in December.
The IHS Markit/CIPS construction purchasing managers’ index dipped to 54.6 in December from 54.7 in November. This was a touch below expectations for a reading of 55.0 but above the 50.0 mark that separates contraction from expansion for the seventh month in a row.
House building was the biggest contributor, while commercial activity also expanded, although the rate of growth eased to its lowest since the recovery began last June. Civil engineering was the weakest-performing category, with activity falling for the fourth time in the past five months.
Tim Moore, economics director at IHS Markit, said: “Overall output growth has slowed in comparison to the catch-up phase last summer, but now it is encouraging to see the recovery driven by new projects and stronger underlying demand.
“A sustained improvement in construction order books resulted in a rise in employment numbers for the first time in nearly two years and the most optimistic growth expectations since April 2017.”
In equity markets, Trainline was under pressure after saying it was selling £150m of convertible bonds to shore up its finances against a potential extended Covid-19 downturn in ticket sales.
IP Group slumped after Invesco sold 61.9m shares in the company in a placing at 100.5p each.
Mitchells & Butlers fell after saying it was planning to raise capital from shareholders with no pubs trading and the company burning through up to £40m a month of cash during the Covid-19 lockdown.
Going the other way, UK supermarket chain Sainsbury’s rallied as it lifted profit forecasts after a booming festive period as Britons treated themselves to champagne and steaks in response to pandemic restrictions on the size of gatherings and online orders hit record levels.
Sainsbury’s said it now expected to report underlying profit before tax of at least £330m in the year to March 2021 against previous expectations of £270m and compared with £586m a year ago after forgoing business rates relief of £410m.
Building materials group CRH was also higher after an upgrade to ‘buy’ at Societe Generale, which said it was set to benefit from a Democratic majority in the US Senate.
Market Movers
FTSE 100 (UKX) 6,817.54 -0.36%
FTSE 250 (MCX) 20,908.61 -0.31%
techMARK (TASX) 4,172.88 -0.58%
FTSE 100 – Risers
Sainsbury (J) (SBRY) 241.70p 3.96%
Ferguson (FERG) 9,170.00p 2.87%
Imperial Brands (IMB) 1,634.50p 2.44%
BT Group (BT.A) 144.00p 2.09%
CRH (CRH) 3,452.00p 2.07%
Hargreaves Lansdown (HL.) 1,567.00p 1.62%
Barratt Developments (BDEV) 683.40p 1.48%
Pershing Square Holdings Ltd NPV (PSH) 2,650.00p 1.34%
Rio Tinto (RIO) 6,187.00p 1.18%
Diageo (DGE) 2,976.50p 1.02%
FTSE 100 – Fallers
Auto Trader Group (AUTO) 588.20p -3.54%
International Consolidated Airlines Group SA (CDI) (IAG) 153.10p -3.16%
British Land Company (BLND) 475.00p -2.82%
InterContinental Hotels Group (IHG) 4,698.00p -2.41%
Rolls-Royce Holdings (RR.) 108.40p -2.39%
Barclays (BARC) 151.90p -2.03%
Pearson (PSON) 684.20p -2.01%
Rightmove (RMV) 632.40p -1.92%
Experian (EXPN) 2,825.00p -1.88%
DCC (DCC) 5,496.00p -1.86%
FTSE 250 – Risers
Energean (ENOG) 834.30p 3.77%
Signature Aviation (SIG) 414.60p 3.65%
Playtech (PTEC) 453.00p 3.05%
FirstGroup (FGP) 72.50p 2.91%
Ferrexpo (FXPO) 342.20p 2.46%
Watches of Switzerland Group (WOSG) 563.00p 2.36%
Petropavlovsk (POG) 33.90p 2.11%
Network International Holdings (NETW) 310.00p 2.11%
Chemring Group (CHG) 296.00p 2.07%
Future (FUTR) 1,826.00p 2.01%
FTSE 250 – Fallers
Trainline (TRN) 437.20p -8.38%
IP Group (IPO) 102.00p -8.11%
Mitchells & Butlers (MAB) 223.00p -6.11%
easyJet (EZJ) 766.60p -4.10%
Wizz Air Holdings (WIZZ) 4,338.00p -2.95%
TP ICAP (TCAP) 239.40p -2.92%
Pets at Home Group (PETS) 420.60p -2.91%
Meggitt (MGGT) 457.30p -2.66%
Bodycote (BOY) 751.50p -2.66%
Wetherspoon (J.D.) (JDW) 1,064.00p -2.56%
