The UK’s basket of leading shares remains on track to end the first trading week of 2021 in stellar fashion and record gains of more than 6% as investors bet on a swift economic recovery.

By 12pm, the benchmark FTSE 100 index had edged a few points higher to 6,861.60, led by housebuilder, consumer and energy stocks.

The mid-cap FTSE 250 gained 0.55% to 21,126.07 as data showed Britain’s job market strengthened for the first time in three months in December.

It comes after Wall Street stocks hit record highs on Thursday as Congress confirmed Joe Biden as the winner of the presidential election, boosting hopes for additional economic stimulus.

US futures suggested this momentum would be sustained when trading resumes later. Asian shares also climbed, with Japan’s Nikkei 225 hitting a 30-year high.

BARRATT’S DIVIDEND BOOST

Shares in the UK’s biggest homebuilder Barratt Developments (BDEV) surged 3.5% to 712.8p, their highest level since before the pandemic, as it revealed plans to resume dividend payments next month and posted a rise in forward six-month sales.

Gold and silver miner Fresnillo (FRES) led the FTSE loser board, down around 3.45% to £12.04.

Marks & Spencer (MKS) fell 1.79% to 138.8p as it reported another big fall in sales of clothing and homewares in the three months leading up to Christmas, as restrictions to curb the spread of the coronavirus hit demand and closed stores.

M&S, one of the best-known names in British retail, said revenue in its clothing and home division slumped 25.1% in the 13 weeks to Boxing Day, its fiscal third quarter, having fallen 21.3% in the previous quarter.

Pets at Home (PETS) jumped 6.42% to 444.4p after raising its profit expectations following a strong third quarter. It said it expects full-year underlying pre-tax profit, including the previously announced repayment of business rates relief of £28.9 million, to be at least £77 million in a third quarter trading update.

British pub operator Marston’s (MARS) gained 6.6% to 79.44p as it said it expects pubs to be closed at least until March as part of the national lockdown imposed earlier this week, with some curbs to remain even after businesses are allowed to reopen.

BEST OF THE REST WRAP

Pest control firm Rentokil Initial (RTO) rose 2.52% to 544.4p after acquiring Tampa-based pest control company Environmental Pest Service. The company said that for the full year ending 31 December 2020, it had acquired 23 new businesses with annualised revenues of over £150 million, for a cash spend of £180 million.

Reach (RCH), the owner of the Daily Mirror and Daily Express newspapers, soared 19.3% to 209.5p after it said it expects profits to beat market expectation after a surge in online revenue.

The company said it expects underlying operating profit for 2020 to be ahead of market expectations, in the range of £130 million to £135 million, following a record digital revenue performance. Online revenue jumped 24.9% in the fourth quarter, up from 13.4% growth in the third.

Reach said it had hit five million online customer registrations, but print circulation continues to decline, falling 11.7% in the fourth quarter.

Reach shares were changing hands at below 56p as recently as the end of September 2020.

Components and solutions company Essentra (ESNT) rose 3.6% to 330p as it saw improved performance in the final quarter of its fiscal year and expected to deliver full-year operating profit in line with market expectations.

Market consensus for operating profit was in the range of £59 million to £63 million.

Integrated shipping services provider Clarkson (CKN) rallied 2.73% to £28.66 after it said expected full-year profit to be ahead of market expectations and in the range of £42 million to £45 million.

Real estate group Harworth (HWG) nudged up 1% to 103p after confirming that it had sold its Bilsthorpe business park in Nottinghamshire for £4.6 million in two separate transactions.

Gasification technology company Eqtec (EQT:AIM) dipped 1.3% to 2.27p after it said it had signed a memorandum of understanding with Greece-based Nobilis Pro Energy to develop the latter’s existing pipeline of opportunities in Thessalia and Central Greece. The stock’s fall reflects investor wariness of energy-related investments.

Find out how to deal online from £1.50 in a SIPP, ISA or Dealing account.

Issue Date: 08 Jan 2021