THE FTSE 100 came within a hair’s breadth of above 7,000 as the London market posted another day of gains.
The index brushed aside immediate fears that Tuesday’s rally — after Monday’s bruises — was a one-off. It rose 1.7 percent, or 117.15 points, to end at 6998.28.
Many market observers were concerned that Tuesday’s recovery was what’s known in the city as a “dead cat bounce” — a phrase that uses the logic that even a dead cat will bounce if dropped from a sufficient height.
Rebound: The FTSE 100 wiped out immediate fears that Tuesday’s rally — after Monday’s bruising — was a one-off. It rose 1.7 percent, or 117.15 points, to end at 6998.28
But travel, retail and other leisure stocks recovered for the second straight session as a series of positive corporate results also boosted stocks.
Michael Hewson, chief market analyst at CMC Markets, said: “Less than two days after Monday’s sharp declines, markets have undergone a complete and utter mood swing.
“Concerns that rising Delta infections will slow the economic recovery appear to have been replaced by optimism that today’s better-than-expected business reports are speaking to a consumer who is down but certainly not out.”
Stock Watch – Foxtons
Foxtons is considering selling its mortgage brokerage business, Alexander Hall.
The division has been part of the London brokerage chain since the 1990s and accounted for around 9 per cent of its £94 million turnover last year.
Alexander Hall has approximately 80 employees.
Foxtons said it was looking at “strategic options” for the company and this could mean selling it.
Shares of the small-cap company, which struggled during the coronavirus pandemic despite house prices hitting record levels, rose 8.2 percent or 3.85p to 50.6p yesterday.
One example was a bullish update to Next (up 7.5 percent, or 552p, to 7946p), which sent fellow retailers Marks & Spencer (up 5.4 percent, or 7.05p, to 138.6p). and Asos (up 4.4 percent, or 163p, to 3907p) higher.
But Next was beaten to first place on the Footsie standings by Rolls-Royce, which tends to excel when airline stocks are higher, as it gets a significant portion of its revenue from flight hours.
The engine maker rose 7.8 percent, or 6.98p, to 97p, followed by other travel-related stocks such as Premier Inn owner Whitbread (6.1 percent or 173p, to 3012p) and British Airways parent IAG (up from 5.6 percent, or 8.96p, to 169.42p).
The FTSE 250 closed 1.9 percent, or 422.49 points, at 22,541.97 points as traders became more excited about the post-Covid outlook.
WH Smith (up 6.6 percent or 100p to 1614.5p), Carnival (+9.4 percent or 9.36p to 1465.4p) and SSP (up 7.2 percent or 16.2p to 240.6p ) all won, while Easyjet ended 4.3 percent or 33.6 pence at 810.8 pence after broker Liberum raised the rating on its shares from “hold” to “buy.”
However, it was Cineworld that knocked it out of the park, up 14.9 percent, or 8.68p, to 67.06p after main rival Odeon said last week it welcomed 1 million customers to its cinemas across Europe, indicating that people still like to shop. go watch movies on the big screen.
Elsewhere on the FTSE 250, reports surfaced that US private equity group Clayton Dubilier & Rice is working on another bid for Morrisons after a £5.5 billion bid was rejected last month.
The supermarket group has instead accepted a £6.3bn offer from investment group Fortress. The bid equates to 254p – but Morrisons’ closing price of 265.1p last night (up 1.5 percent or 4p) indicates the city is gearing up for a bidding war.
Miners, including Antofagasta, were higher after copper prices stabilized, although the group (4.3 percent or 58p, to 1422p) saw production fall 3 percent in the first six months of the year.
Footsie peer Rio Tinto announced that after 32 years it will fund a study assessing the environmental damage of its copper and gold panguna mine in Papua New Guinea. It has not yet decided whether the mine clearance will be funded.
Rio (2.3 percent or 135p, to 5971p) is trying to restore its reputation after it blew up two 46,000-year-old caves in Australia.
The Anglo-Australian group added that it has closed one of the four furnaces of its Richards Bay Minerals operation in South Africa due to a decline in the amount of materials supplied to burn.
It attributes this to the escalating security situation in South Africa, where tensions have risen after former President Jacob Zuma was arrested.
Some links in this article may be affiliate links. If you click on it, we can earn a small commission. That helps us fund This Is Money and use it for free. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.