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28 Jan 2021 | 16:16

London close: Stocks finish mixed as Reddit-fuelled frenzy calms

(Sharecast News) - London stocks finished in a mixed state on Thursday, as worries about the Covid-19 pandemic and the vaccine rollout dented sentiment. The FTSE 100 ended the session down 0.63% at 6,526.15, while the FTSE 250 was 0.44% firmer at 20,368.25.

Sterling was in the green, last gaining 0.27% on the dollar to trade at $1.3724, and advancing 0.19% against the euro to €1.1322.

"Stocks have largely recouped earlier losses as the fear that previously ran through the markets has dissipated," said CMC Markets analyst David Madden.

"This morning the mood was fearful due to concerns that some hedge funds were frantically closing out positions in a bid to free up cash to meet margin calls requirements on short positions that have gone horribly wrong for them."

Madden explained that short squeezes were due to retail traders snapping up stocks like Gamestop.

"There was a fear that other investment firms might start dumping stocks just to exit the market.

"Sentiment in equities has since improved as those worries in relation to hedge funds have faded.

"It was announced that a couple of trading apps, that have been facilitating retail investors' battle with certain hedge funds, have imposed restrictions on certain stocks."

That, Madden said, had helped bring down the fear factor as the battle would not be as intense now.

Overnight, US stocks sank as Reddit retail investors continued to disrupt Wall Street.

Neil Wilson, chief market analyst at, said there was a clear sense markets were upset and concerned about what they were seeing from the "Reddit ramps".

"The mechanics of the latest craze are rather new, which makes it hard for us market watchers to be fully versed in all that is happening.

"And yet the point I'd like to stress is that this kind of behaviour among investors - chasing individual stocks to the moon - has been seen a million times in the past.

"It usually ends one way - many profit, but most lose out."

In equity markets, Prudential shares slid 7.83% after the insurer announced plans to separate its US business through a demerger and said it was considering raising $2.5bn to $3bn in new equity.

Paragon Banking Group was down 1.56% and Victrex was 1.66% weaker, as their stocks went ex-dividend.

On the upside, precious metals miner Fresnillo surged 7.18%, having slumped on Wednesday after lowering its gold output forecast.

Drinks company Diageo rallied 3.15% after it increased its interim dividend as it reported first-half operating profit down 8.3% to £2.2bn.

Tate & Lyle was also on the rise, advancing 4.06% after it hailed a "strong" third-quarter performance, with volume growth in each business and group revenue up 8% compared to the same period a year ago.

Hungarian low-cost airline Wizz Air ascended 4.71% despite saying it swung to a loss in the third quarter as revenues were dented by the pandemic.

EasyJet was also firmer, adding 4.57%, after the budget airline said it expected to fly no more than 10% of 2019 capacity in the second quarter as tighter coronavirus restrictions triggered an 88% slump in revenue for the three months.

Market Movers

FTSE 100 (UKX) 6,526.15 -0.63% FTSE 250 (MCX) 20,368.25 0.44% techMARK (TASX) 4,097.14 -0.64%

FTSE 100 - Risers

Fresnillo (FRES) 982.80p 6.36% International Consolidated Airlines Group SA (CDI) (IAG) 145.60p 4.75% Glencore (GLEN) 248.70p 4.58% Anglo American (AAL) 2,441.50p 3.89% M&G (MNG) 184.10p 3.37% Diageo (DGE) 2,943.00p 3.15% Kingfisher (KGF) 282.80p 3.14% Melrose Industries (MRO) 169.70p 3.13% B&M European Value Retail S.A. (DI) (BME) 548.20p 2.81% Evraz (EVR) 502.20p 2.26%

FTSE 100 - Fallers

Prudential (PRU) 1,234.00p -7.98% Pearson (PSON) 800.00p -7.81% Imperial Brands (IMB) 1,514.00p -4.03% Ocado Group (OCDO) 2,776.00p -3.50% Sage Group (SGE) 600.20p -2.97% Hargreaves Lansdown (HL.) 1,721.50p -2.68% Pennon Group (PNN) 945.00p -2.52% Smith & Nephew (SN.) 1,568.00p -2.48% Royal Dutch Shell 'A' (RDSA) 1,366.80p -2.13% Compass Group (CPG) 1,342.50p -2.12%

FTSE 250 - Risers

Hochschild Mining (HOC) 209.20p 8.45% TUI AG Reg Shs (DI) (TUI) 360.30p 7.23% Babcock International Group (BAB) 227.30p 6.21% Aston Martin Lagonda Global Holdings (AML) 1,949.50p 5.61% AO World (AO.) 315.50p 5.17% Wizz Air Holdings (WIZZ) 4,402.00p 4.71% easyJet (EZJ) 746.60p 4.57% Meggitt (MGGT) 405.30p 4.22% Tate & Lyle (TATE) 688.00p 4.08% 4Imprint Group (FOUR) 2,395.00p 3.90%

FTSE 250 - Fallers

Cineworld Group (CINE) 75.02p -6.69% Network International Holdings (NETW) 349.20p -6.03% XP Power Ltd. (DI) (XPP) 4,990.00p -5.13% Paragon Banking Group (PAG) 455.20p -4.53% Plus500 Ltd (DI) (PLUS) 1,325.00p -4.09% Watches of Switzerland Group (WOSG) 640.00p -3.90% Vietnam Enterprise Investments (DI) (VEIL) 582.00p -3.64% VinaCapital Vietnam Opportunity Fund Ltd. (VOF) 409.00p -3.42% Petropavlovsk (POG) 29.00p -3.33% PureTech Health (PRTC) 371.50p -3.00%
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