UK stocks pushed higher at the open on Wednesday, despite the sobering news UK gross domestic product (GDP) fell by a record 20.4% in the three months to June, confirmation the UK has lurched into its deepest-ever recession, as the bulls focused on a better than anticipated economic bounce-back in June.
At 8.30, the FTSE 100 was up 36.7 points, or 0.6%, at 6,191.04.
Admiral (ADM) added 5.3% to trade at £26.60 after the insurer reinstated its special dividend as it reported a jump in first-half earnings, the latest car insurer to benefit from a slump in claims as coronavirus lockdowns kept motorists off the road in March and April.
Spun out of Prudential (PRU) last year, insurer and asset manager M&G (MNG) was marked up 6.4% to 184.7p despite reporting a fall in first-half operating profit, caused by market moves and client outflows as a result of the pandemic.
The results were actually better than analysts had predicted, while M&G also declared an interim dividend of 6p, in line with its policy of paying one-third of the previous year’s final dividend.
‘This has been a resilient performance in extremely difficult times, with the value of our diversified business mix coming through strongly,’ insisted chief executive John Foley.
Elsewhere, online fashion retailer ASOS (ASC:AIM) strutted 7.8% higher to £45.48 as a short pre-close trading update highlighted a strong operational performance and year-on-year improvements in profitability, supported by stronger than anticipated underlying demand.
For the year to August 2020, ASOS now expects revenue growth to be between 17% and 19% and pre-tax profit to be in the £130 million-to-£150 million range, so a significant beat to current expectations.
Investors also showed an appetite for food delivery play Just Eat Takeaway (JET), which jumped 3.7% to £89.99 after expressing confidence that growth will remain strong for the rest of the year after reporting a sharp jump in first half revenue spurred by merger activity.
A beneficiary of the work-from-home trend accelerated by lockdowns, Avast’s current assessment ‘is that the pronounced uplift experienced in the first half was temporary’.
Although the company doesn’t anticipate ‘the strongly elevated performance levels of the second quarter to be sustained’, it is nevertheless confident that ‘Avast is able to capture material benefits from the most recent period beyond the short term.’
7digital (7DIG:AIM) shot up 39% to 0.815p after the digital music minnow inked a new contract with Triller to ‘power the world’s fastest growing social music video app with its Music Platform-as-a-Service offering’.