The UK’s major stocks closed more than 100 points to the good on Tuesday with the market’s mood lifted by a strong bounce on Wall Street and the fastest UK house price growth in 15 years.

That latter point was made by the Halifax’s latest quarterly report. House prices rose 3.4% in the three months to 30 November, the sharpest increase since late 2006, and are 8.2% higher than a year earlier, with the average price of a UK home hitting a fresh record high of £272,992, the mortgage lender said.

That inevitably saw housebuilder shares on the front foot, with Persimmon (PSN) and Barratt Developments (BDEV) gaining 1.7% to £28.19 and 731.47p respectively, and Berkeley (BKG) up 1.5% to £46.07.

At the finish, the benchmark FTSE 100 was trading 1.2% higher at 7,3172.27 while mid-caps were also strong, the FTSE 250 1.4% ahead at 23,195.52.

US stocks surged as investors supported the recovery made on reports that the new Omicron variant is likely to be less damaging to the global economy than previous strains due to milder symptoms.

The Dow Jones Industrial Average rose 1.5% by the UK close, while the broader S&P 500 gained 2.15%, but tech stocks bounced hardest, the Nasdaq Composite surging more than 3%.

MOVING ON THE MARKET

US-focused plumbing products group Ferguson (FERG) ended the day 5% ahead at £121.44 as it raised full year expectations after reporting a rise in first quarter sales.

‘Supportive end markets and continued market share gains drove substantial sales growth,’ said Ferguson.

While the company continues to expect a tapering of growth in the second half on tougher prior year comparatives, Ferguson raised full year expectations given ‘strong’ momentum in the business and the agility of its business model.

Also in demand was equipment hire giant Ashtead (AHT), which advanced 4% to £64.42, after upgrading its full year outlook following a surge in half year profit amid a jump in rental revenue.

For the half year to October 2021, pre-tax profit rose 38% to $474 million year-on-year as revenue increased 18% to $3.88 billion. Looking ahead, the company upgraded full year group rental revenue growth guidance to a range of 17%-to-20%, up from 13-to-16% previously.

British American Tobacco (BATS) was up 1% to £26.525 after announcing it is ‘confident’ of delivering against full year earnings growth guidance, having grown annual revenue by 5% at constant currency off the back of strong growth in new product categories.

Going the other way was pharmaceutical giant AstraZeneca (AZN), down 1.7% to £82.23 despite news it has signed a development agreement with Ionis Pharmaceuticals for a drug to treat transthyretin amyloidosis.

AstraZeneca will pay Ionis $200 million upfront and additional payments of up to $485 million following regulatory approvals, plus sales-related milestone payments and royalties.

GlaxoSmithKline (GSK) made 1.35% gains to £15.76 as it unveiled trial results indicating a Covid-19 therapy that it is developing with Vir Biotechnology still works against the Omicron variant.

AROUND THE MARKET

Defence contractor Babcock (BAB) lost earlier gains to end the day largely flat at 306.7p, having swung to a first half profit underpinned by rising revenue and leaner spending as a turnaround strategy takes hold.

PageGroup (PAGE) climbed 3.8% to 678p after the recruiter upgraded its annual earnings guidance as improved market conditions persisted into the fourth quarter.

Elsewhere, fund manager Liontrust (LIO) improved 2% to £23.15 on news it is buying Majedie Asset Management for up to £120 million.

UK-based asset manager Majedie has a long-term pedigree in institutional fund management, which is an area of increasing strategic focus for Liontrust.

Somero (SOM:AIM) rallied 6% to 501.4p as the construction industry equipment manufacturer upgraded its annual earnings, revenue and cash guidance amid continued strong trading in North America.

Agriculture-to-engineering combine Carr’s (CARR) gained 4.5% to 152.5p on slightly better-than-expected full year results and a positive outlook statement.

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Issue Date: 07 Dec 2021