UK shares opened higher on Wednesday following yesterday’s sharp fall, helped by gains in oil shares with Royal Dutch Shell (RDSB) and BP (BP) gaining just over 2% each.

The pound was steady despite a 0.7% jump in consumer price inflation for March, lifted by higher fuel prices which reflect the large falls seen last year at the start of the pandemic.

Sterling was 0.2% lower against the US dollar at $1.39. Brent Crude prices were 0.2% lower at $66.4 a barrel and Gold was 0.2% higher at $1,781 an ounce.

Overnight trading saw Japan’s Nikkei 225 index drop 2% on fears of fresh lockdowns in Tokyo and Osaka, while shares in China’s SE Composite index were flat.

At 9am the FTSE 100 index of leading shares was 0.5% higher at 6,896 points.

CORPORATE NEWS

Miner BHP (BHP) increased guidance for copper production to between 1,535 kt and 1,660 kt after stronger than expected performance at Escondia. Petroleum and iron ore production was unchanged.

Over the nine months to 31 March, copper equivalent production was marginally lower as strong production was offset by the impact of planned maintenance and adverse weather. The shares added 1% to £21.85.

Fellow miner Antofagasta (ANTO) said first quarter production was in line with guidance with copper production 5.7% lower year-on-year at 183,000 tonnes and net cash costs at $1.16/lb.

Gold production was 59,100 ounces in the quarter, 9.2% lower than last year and 8% higher than the fourth quarter of 2020.

Full year guidance remained unchanged at 730-760,000 tonnes of copper at a net cash cost of $1.25/lb and capital expenditure of $1.6 billion. The shares dropped 0.75 to £18.28.

Distribution and services group Bunzl (BNZL) reported a 5.4% rise in first-quarter revenue driven by demand for Covid-19 related products and a recovery in other products.

Guidance remained unchanged, with the company continuing to expect robust revenue growth in 2021 compared to the prior year. The shares sank 4.3% to £23.96.

INCREASED GUIDANCE

Shares in plastics producer Synthomer (SYNT) gained 3.7% to 499.4p after the company upgraded its annual earnings guidance saying volumes and unit margins were significantly ahead of the prior year driven by ‘exceptional demand’ because of the Covid-19 pandemic.

Earnings before interest, tax, depreciation and amortisation for the year through December were now expected to be in excess of £450 million.

Power generation company Drax Group (DRX) said first quarter trading was ‘robust’ and it had ended commercial coal generation amid progress on its decarbonisation strategy.

The company completed the sale of its existing gas generation assets in January 2021 and acquired Canadian biomass producer Pinnacle Renewable Energy.

Full year expectations for the Group were said to remain underpinned by continued good operational availability for the remainder of 2021. The shares added 0.4% to 422.3p.

Warehouse assets investor Tritax Big Box REIT (BBOX) said it had acquired a 'state of the art' distribution unit in Avonmouth, Bristol for £90 million.

The acquisition reflecting a net initial yield of 5.1% for about a 13-year income.

The asset is leased to global importer Accolade Wines and expands the company's exposure to the South West of England. The shares nudged-up 0.2% to 191.1p.

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Issue Date: 21 Apr 2021