UK shares made small gains in early trading on Wednesday while European markets took a step back after overnight weakness in US, Asian and Indian technology stocks following their record run this year.

A fall in the dollar also drove investors to sell US stocks and helped lift defensive assets including gold, which rose to $1,881 per ounce pre-market.

At 8.30am the FTSE 100 index of leading stocks was up 14 points or 0.2% to 6,616 with banks recovering from yesterday’s sell-off while miners and utilities were in the red, although volume was thin as usual during the holiday period.

COMPANY NEWS

The big news of the day was the approval by UK health authorities of the Covid vaccine developed by AstraZeneca (AZN) and the University of Oxford, despite initial clinical trials showing it to be less effective than shots developed by Pfizer/BioNTech and Moderna.

Scientists believe all three vaccines should be equally effective against the new variant which is 70% more transmissible and has driven the latest surge in virus cases in the UK. Astra shares gained 122p or 1.6% to £75.84.

Also in the health care sector, Alliance Pharma (APH:AIM) announced it had completed the acquisition of US rival Biogix for $110 million in cash. The deal brings Biogix’s fast-growing menopause relief drug Amberen as well as increased scale in the all-important US over-the-counter market.

The deal is expected to increase group earnings in the 2021 financial year and ‘significantly’ increase earnings from the 2022 financial year. Shares were steady at 87.4p after bolting 10% higher yesterday.

House builders were lifted by the latest Nationwide house price survey which showed average house prices rising by a six-year high of 7.3% on an annual basis in December, up from an already-strong 6.5% gain in November.

The price of detached homes rose by more than 8% on last year while flat prices rose by just under 4%. Growth in average prices was strongest in the East Midlands, the North West and the outer South East, which covers smaller cities such as Brighton, Oxford and Southampton, as the exodus from major hubs such as London continues.

Shares in Barratt Development (BDEV), Bellway (BWY) and Taylor Wimpey (TW.)  were up by between 1% and 1.5%.

Among small-caps, asset management consultancy MJ Hudson (MJH:AIM) announced it had acquired German fund performance analytics firm Prof Gottschalg UG and its PERACS subsidiary.

The German businesses offer metrics and insights into fund performance in the alternative asset management industry, which is strongly aligned with MJ Hudson’s core business. Shares climbed 2.2% to 47.5p.

Shares in investment platform AJ Bell (AJB) dipped 0.4% to 473p after founder Andy Bell and director Fergus Lyons sold a total of 5.38 million shares or 1.3% of the firm’s issued capital at a discounted price of 460p.

Disclaimer: AJ Bell is the owner and publisher of Shares magazine. The author owns shares in AJ Bell.

FOR A LIST OF FTSE 100 GAINERS AND LOSERS SEE HERE

 

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Issue Date: 30 Dec 2020