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24 Mar 2021 | 16:46

London close: Stocks turn firmer as resource plays rise

(Sharecast News) - London stocks managed a positive finish on Wednesday, having spent much of the session in the red amid ongoing worries about a third wave of coronavirus, as investors digested the latest UK inflation and business activity data. The FTSE 100 ended the day up 0.2% at 6,712.89, and the FTSE 250 was 0.33% firmer at 21,402.54.

Sterling was weaker, however, last falling 0.23% against the dollar to $1.3720, and slipping 0.03% on the euro to trade at €1.1603.

"The same old worries about another wave of coronavirus cases as well as concerns that Europe's lockdown will drag on are doing the rounds," said CMC Markets analyst David Madden.

"The major equity markets are mixed as the close of the trading day draws near.

"It seems that dealers are somewhat immune to the Covid-19 news as they realise the extended restrictions will not last forever."

Madden noted that London's top-flight index was outperforming its European counterparts, as an upward move in natural resource plays was giving an edge to the British market.

"The bullish moves in oil and copper have lifted BP, Royal Dutch Shell, Rio Tinto, Glencore and Anglo American."

Earlier, investors mulled over the latest figures from the Office for National Statistics, which showed inflation unexpectedly fell in February as the price of clothes and second-hand cars declined.

Consumer price inflation fell to 0.4% from 0.7% in January, coming in below expectations of 0.8%.

Clothing, second-hand cars, and games, toys and hobbies were the largest downward contributors. Clothing and footwear prices fell 5.6% in the year to February 2021 - the biggest fall since November 2009.

Meanwhile, the core rate of inflation - which excludes more volatile energy and food prices - declined to 0.9% in February from 1.4% the month before, versus expectations of no change.

Market participants were also digesting a survey showing that UK business activity returned to growth in March, powered by stronger consumer confidence and rebounding sales ahead of a planned lifting of the Covid-19 lockdown.

The initial reading for the IHS Markit/CIPS UK composite purchasing managers' index jumped to 56.6 from 49.6 a month earlier.

The increase was the fastest since August, supported by the first rise in new orders since September, with the total figure well ahead of the 50-point mark that indicates no growth.

Services drove the improvement with a forecast-beating reading of 56.8, up from 49.5 in February as the UK's dominant sector returned to expansion.

Analysts had expected a score of 51 on average, while manufacturing also outstripped expectations with a score of 57.9, up from 55.1.

In equity markets, housebuilder Bellway lost 2.26% after it reinstated its dividend and reported a strong forward order book, but said interim profits had fallen slightly.

Sector peers followed suit, with Taylor Wimpey down 3.1%, Barratt Developments losing 1.72% and Crest Nicholson 1.75% lower.

WH Smith was hit by a downgrade to 'neutral' at JPMorgan, closing 2.38% weaker.

On the upside, British Airways owner IAG ascended 3.98%, Premier Inn owner Whitbread rose 3.11% and caterer Compass Group was 1.03% higher, recovering from heavy losses earlier in the week.

Safety and protection company Halma rallied 2.34% after it said annual profit would beat expectations as revenue continued to improve and rose in all its major regions.

Softcat surged 14.5% after the IT infrastructure and services provider said full-year results were set to be "significantly" ahead of its previous expectations.

Market Movers

FTSE 100 (UKX) 6,712.89 0.20% FTSE 250 (MCX) 21,402.54 0.33% techMARK (TASX) 4,180.29 -0.38%

FTSE 100 - Risers

International Consolidated Airlines Group SA (CDI) (IAG) 194.80p 3.98% Kingfisher (KGF) 325.00p 3.17% Whitbread (WTB) 3,348.00p 3.11% British Land Company (BLND) 514.20p 2.63% Rolls-Royce Holdings (RR.) 108.00p 2.56% Land Securities Group (LAND) 696.90p 2.43% Halma (HLMA) 2,359.00p 2.34% Anglo American (AAL) 2,783.00p 2.28% Glencore (GLEN) 278.15p 2.26% Lloyds Banking Group (LLOY) 42.23p 2.16%

FTSE 100 - Fallers

Taylor Wimpey (TW.) 178.15p -3.10% Just Eat Takeaway.Com N.V. (CDI) (JET) 6,660.00p -2.94% Scottish Mortgage Inv Trust (SMT) 1,122.00p -2.69% London Stock Exchange Group (LSEG) 7,080.00p -2.48% Ocado Group (OCDO) 2,055.00p -2.33% Aveva Group (AVV) 3,390.00p -2.05% Fresnillo (FRES) 910.00p -1.96% BT Group (BT.A) 146.25p -1.81% Reckitt Benckiser Group (RB.) 6,434.00p -1.77% Admiral Group (ADM) 2,993.00p -1.74%

FTSE 250 - Risers

Gamesys Group (GYS) 1,944.00p 18.39% Softcat (SCT) 1,785.00p 14.50% TUI AG Reg Shs (DI) (TUI) 378.60p 6.68% SSP Group (SSPG) 344.00p 6.37% Tullow Oil (TLW) 51.94p 6.11% Drax Group (DRX) 431.00p 4.56% Hammerson (HMSO) 32.34p 4.29% 888 Holdings (888) 394.00p 4.23% Centamin (DI) (CEY) 105.95p 3.82% Future (FUTR) 1,894.00p 3.72%

FTSE 250 - Fallers

XP Power Ltd. (DI) (XPP) 4,630.00p -6.46% HICL Infrastructure (HICL) 163.00p -3.89% PZ Cussons (PZC) 263.00p -3.13% CMC Markets (CMCX) 444.00p -3.06% Just Eat Takeaway.Com N.V. (CDI) (JET) 6,660.00p -2.94% Dr. Martens (DOCS) 480.60p -2.91% AO World (AO.) 297.00p -2.78% Lancashire Holdings Limited (LRE) 619.50p -2.67% Frasers Group (FRAS) 474.00p -2.59% Fidelity China Special Situations (FCSS) 418.50p -2.45%
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