UK stocks opened substantially higher on Friday after Donald Trump laid out reopening plans for the US economy, with the FTSE 100 up 158 points or 2.8% at 5,786.1 early on. Markets were also buoyed by reports that a coronavirus treatment from Gilead Sciences had delivered positive results.
The rally came despite China announcing its first every quarterly economic contraction on record, with gross domestic product (GDP) falling 6.8% in the three months through March.
In corporate news, Rio Tinto (RIO) ticked up 5.2% to £38.85 as it reported a 2% rise in first quarter iron ore production after its operations recovered from cyclone activity in Australia a year earlier. However, the mining giant also downgraded its annual copper output guidance and cut its capital spending plans due to the COVID-19 crisis.
Flutter Entertainment (FLTR) sparked up 7.5% to £83.84 after the gambling group announced a 29% rise in first quarter revenue, generated before recent sports disruption, and said recent trading has been ahead of downgraded expectations.
Primark owner Associated British Foods (ABF) improved 3.2% to £19.98 after receiving confirmation that it is eligible to access funding under the UK government’s Covid Corporate Financing Facility (CCFF), a lending programme launched to offer fiscal support to companies during the coronavirus pandemic.
All 376 Primark stores in 12 countries have been closed since March 22, representing a loss of £650m of net sales per month.
Premier Inn owner Whitbread (WTB) rallied 8.7% to £28 on confirming that it too is an eligible user of the government’s CCFF. However Whitbread has yet to issue any commercial paper from this programme and in addition to this facility, has accessible cash reserves of £400m and access to £900m of its existing RCF.
Tobacco company Imperial Brands (IMB) puffed 1.7% higher to £16.03 after it said it would delay its interim results by two weeks to give auditors more time to review statements during the coronavirus crisis, while reiterating there has been ‘no material impact’ on performance to date as a result of COVID-19.
Hedge fund manager Man Group (EMG) was marked up 3.5% to 126.5p as it became one of the minority of companies to not cancel its 2019 final dividend. Man also said it would also keep its share buyback going amid continued net inflows into its funds.
Wealth manager Brewin Dolphin (BRW) bounced 6.4% higher to 226p despite seeing £7.1bn wiped off its total funds under management in the second quarter and warning it cannot predict the impact of the coronavirus crisis on profitability.
Investors were reassured as Brewin Dolphin highlighted its strong balance sheet and ‘a robust regulatory capital position, which will support us as markets recover and enable us to service the growing demand for financial advice in the UK and Ireland.’
Elsewhere, Hollywood Bowl (BOWL) surged 11.9% higher to 160p as the ten-pin bowling operator unveiled plans to boost balance sheet strength through a £10.9m placing to help see it through the coronavirus lockdown.
Estate agent Foxtons (FOXT) skipped 9.6% higher to 42.1p, despite reporting a fall in quarterly revenue on lower lettings activity pinned on UK government Covid-19 lockdown measures, as it said it would raise £22m from a share issue.
Foxtons will use the placing proceeds to fully repay its revolving credit facility and provide sufficient liquidity for it to battle the impact of the coronavirus pandemic.