London markets rose for the second day on the bounce on Wednesday as investors continued to see the positives in a post-coronavirus economic recovery.
The UK’s benchmark FTSE 100 rallied 0.9% in early trading to 6,299.31, following Tuesday’s biggest gains in a month , thanks to robust US economic data and positive results from a UK drug trial in reducing Covid-19 death rates.
Scientists in the UK found a cheap and widely available steroid, dexamethasone, reduces mortality rates among hospitalisations for the virus.
The FTSE 250 ran around 0.7% higher at 17,590.37.
The upbeat tone was seen across Europe, where major indexes were also firm, led by the French CAC 40’s near-1.2% gain. The wider Eurostoxx 50, which covers 50 of Europe’s largest and most influential companies, rose about 1%.
ENERGY FIRM JUMPS
Energy networks and renewables business SSE (SSE) set a rapid pace among FTSE 100 stocks, jumping nearly 9% as it committed itself to delivering on its five-year dividend plan and posted robust underlying profits.
That news will boost hard hit income investors despite SSE lowering its first half payout due to the coronavirus.
Also rising fast was online fashion group Boohoo (BOO:AIM), surging close on 10% at 424.9p as it forecast annual results ahead of market expectations, thanks to strong demand for its brands and apparel during coronavirus-led lockdowns.
Boohoo is also set to buy former high street fashion brands Oasis and Warehouse just two months after their collapse into administration.
Outsourced services provider Serco (SRP) jumped nearly 17% to 155.15p after guiding for a rise in first half underlying trading profit of about 50%, amid ‘limited’ impacts from the Covid-19 crisis.
Serco also reinstated guidance for the full year that included upgraded revenue expectations.
Acting as a drag was pizza delivery group Domino's Pizza (DOM), which slumped 10% to 305p. The FTSE 250 company guided for a slight fall in first half operating profit despite people ordering more pizzas during lockdown.
Domino’s said higher costs needed to keep people safe from Covid-19 was the chief reason.
ELSEWHERE ON THE MARKET
Homes builder Berkeley (BKG) rose 3.6% to £43.78, despite announcing that its annual profit fell by more than a third as it sold fewer homes in a declining price environment.
Berkley said it entered the coming year from a position of relative strength, with net cash of £1.14bn and forward sales of £1.9bn.
DIY group Kingfisher (KGF) gained nearly 6% to 215.3p even as it booked 66% slump in annual profit amid a continued poor showing from its French business.
Kingfisher also said its performance had improved in May following a slump in April as it gradually reopened shuttered stores in the UK and France.
Gambling company William Hill (WMH) dropped 4.5% to 132.65p after it pitched a £224m equity raising to bolster its balance sheet at 128p a share.
Infrastructure products supplier Hill & Smith (HILS) made modest 0.8% gains at £13.10 after announcing that it had seen a ‘modest recovery’ in performance in May as lockdown measures eased.
The company, seen as a major beneficiary of large global infrastructure investment projects, stressed it remained cautious given market uncertainty.
Banknote printer De La Rue (DLAR) slid 1.6% to 150.4p even as it reported a rise in profit as lower costs and a gain on the sale of its international identity solutions business offset a fall in revenue.
Structural steel group Severfield (SFR) firmed 4% to 76.4p, having posted a 4.5% rise in annual profit. The company has suspended dividends until it gets more clarity on the impact of Covid-19.