London open: Stocks rise amid US stimulus hopes

Mon 19 Oct 2020

LONDON (SHARECAST) - (Sharecast News) - London stocks edged higher in early trade on Monday, with sentiment underpinned by encouraging Chinese data and hopes of further US stimulus.
At 0845 BST, the FTSE 100 was up 0.5% at 5,951.74.

Investors digested the latest figures from China's National Bureau of Statistics, which showed the economy there continued to recover in the third quarter, albeit a little less than expected.

China's economy expanded by 4.9% on the year, up from 3.2% growth in the second quarter and a big turnaround form the 6.8% contraction recorded in the first quarter of the year. Economists had been expecting a 5.2% increase.

Data also showed that Chinese retail sales rose 3.3% on the year in September, up from 0.5% growth the month before and versus expectations of 1.8% growth.

Industrial production rose 6.9% on the year in September, up from 5.6% in August and compared to expectations of a 5.8% increase.

Spreadex analyst Connor Campbell said: "A rebounding, if disappointing, Chinese Q3 GDP reading and a new stimulus deadline in the US were the focal points of Monday's trading."

He said that while the GDP figure was below forecasts, "any ill-feeling was tempered by improving industrial production and unemployment rate numbers, and, crucially, a far better than expected retail sales reading".

"In the US, Nancy Pelosi has set a 48 hour deadline for a bi-partisan stimulus deal to be agreed upon if a package is to be put in place before the election," said Campbell. "Negotiations wouldn't stop after that point, but would mean any relief would be delayed until after the vote."

In equity markets, hospitality, leisure and travel-related stocks recovered after taking a hit last week on concerns about the pandemic and further restrictions, with engine maker Rolls-Royce, British Airways parent IAG and Premier Inn owner Whitbread all higher.

Pub chain Wetherspoons, travel company TUI and cruise operator Carnival also gained.

Security services firm G4S was in focus after it again rejected GardaWorld's 3bn offer as the Canadian company posted full details of its 190p-a-share bid. GardaWorld, 51% owned by private equity firm BC Partners, has not changed the terms of its bid, which G4S has dismissed as "highly opportunistic".

In broker note action, office space provider IWG was boosted by an upgrade to 'buy' at Berenberg, while Trainline was boosted by an initiation at 'buy' by Deutsche Bank.

InterContinental Hotels was knocked lower by a downgrade to 'hold' at Peel Hunt.

Market Movers

FTSE 100 (UKX) 5,951.74 0.54%
FTSE 250 (MCX) 17,885.75 0.35%
techMARK (TASX) 3,844.30 0.53%

FTSE 100 - Risers

Rolls-Royce Holdings (RR.) 229.20p 3.29%
Vodafone Group (VOD) 111.88p 2.30%
International Consolidated Airlines Group SA (CDI) (IAG) 97.86p 2.17%
Glencore (GLEN) 166.80p 1.98%
Barclays (BARC) 103.78p 1.94%
Whitbread (WTB) 2,262.00p 1.71%
Lloyds Banking Group (LLOY) 27.47p 1.68%
Standard Chartered (STAN) 376.00p 1.68%
Burberry Group (BRBY) 1,559.00p 1.60%
Compass Group (CPG) 1,196.50p 1.53%

FTSE 100 - Fallers

Just Eat Takeaway.Com N.V. (CDI) (JET) 9,826.00p -1.54%
St James's Place (STJ) 936.60p -0.87%
InterContinental Hotels Group (IHG) 4,144.00p -0.72%
Smurfit Kappa Group (SKG) 3,198.00p -0.68%
Mondi (MNDI) 1,611.00p -0.65%
Hikma Pharmaceuticals (HIK) 2,668.00p -0.63%
Hargreaves Lansdown (HL.) 1,410.50p -0.56%
GVC Holdings (GVC) 1,059.50p -0.56%
Pearson (PSON) 541.20p -0.51%
Flutter Entertainment (FLTR) 13,220.00p -0.41%

FTSE 250 - Risers

IWG (IWG) 284.00p 8.56%
Wetherspoon (J.D.) (JDW) 814.50p 5.30%
TUI AG Reg Shs (DI) (TUI) 285.80p 3.81%
Trainline (TRN) 343.80p 3.74%
Carnival (CCL) 937.60p 3.40%
Fisher (James) & Sons (FSJ) 1,304.00p 3.16%
Babcock International Group (BAB) 264.70p 2.80%
Frasers Group (FRAS) 362.40p 2.14%
Aston Martin Lagonda Global Holdings (AML) 50.45p 2.08%
Airtel Africa (AAF) 66.80p 1.98%

FTSE 250 - Fallers

4Imprint Group (FOUR) 1,952.00p -3.37%
Future (FUTR) 1,942.00p -2.71%
Playtech (PTEC) 360.00p -2.23%
C&C Group (CCR) 173.80p -2.03%
St. Modwen Properties (SMP) 311.50p -1.74%
Watches of Switzerland Group (WOSG) 403.00p -1.71%
Apax Global Alpha Limited (APAX) 157.40p -1.63%
Just Eat Takeaway.Com N.V. (CDI) (JET) 9,826.00p -1.54%
FirstGroup (FGP) 48.10p -1.35%
Monks Inv Trust (MNKS) 1,202.00p -1.15%
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