UK shares closed higher on Tuesday, as miners once again outperformed other stocks, along with housebuilders and grocer Tesco (LON:TSCO) while the FTSE 250 index headed to May 2015 highs.
Shares in Anglo American (LON:AAL) were the biggest gainers, rising by 5% at one point and closed up 2.7% at 857.42p, with shares in another mining firm, BHP Billiton (LON:BLT), also up by 4.4% at one point but ended up 2.3% at 1,056.51p.
But two leading housebuilders also enjoyed continued big increases in their market value.
Shares in the housebuilder Barratt (LON:BDEV) closed 4.9% higher at 486.29p, and shares in Persimmon (LON:PSN) rose by 4% to 1,864.78p. Persimmon said customer interest since the Brexit vote had been "robust".
Tesco, meanwhile, closed up 3.4% at 164.89p after a retail report on the sector shone favourably on the grocer.
One analyst “blamed the weather” on Tesco’s improved performance.
“Tesco shares are trading higher by 3% this morning after a sales boost in the last 12 weeks, fuelled mainly by the good weather, and the Olympics. However, despite the boost, market share is still declining albeit at a slower pace which could possibly signal a return to growth in the not so distant future for the supermarket giant,” said Vinay Sharma, Senior Trader at ayondo markets.
The FTSE 250 index closed up 0.6% at 17,982 as it closed in on 18000 for the first time since May 2015.
The FTSE AIM 100 Index advanced 0.2% to 3,770 while the FTSE AIM All-Share Index was up 0.3% to 790.
London gainers outnumbered losers by 38% to 26% and even beat the unchanged stocks of 36%.
London afternoon
UK shares roses strongly again led by housebuilders and supermarkets and the prospect of a strong start on Wall Street.
FTSE 100 was 46 points higher at 6,874, with Persimmon (LON:PSN) leading the way adding 3.7% to 1,861p on better than expected results.
In the six months to June, pre-tax profit rose 29% to £352.3mln on a 12% boost to revenue to £1.49bn.
Legal completions increased 6% to 7,238 new homes sold while the average selling price grew 6% to an average of £205,762.
Broker Liberum said that the improved sales rate showed that customers in Persimmon's markets – outside of London- appeared to be shrugging off Brexit uncertainties.
The news cheered others in the sector and Barratt Developments plc (LON:BDEV) added 4.5% to 484.40p.
Taylor Wimpey (LON:TW.) rose 3% and and Berkeley Group plc (LON:BKG) 3.5%.
Tesco PLC (LON:TSCO), up 3.6% to 165.3p led the supermarkets higher following the latest monthly data from research group Kantar WorldPanel.
Aldi’s growth was the slowest for five years, though still 12.2%, while Tesco saw sales dip by the lowest amount for six months.
Asda’s woes continued as sales fell by 5.5% in the 12 weeks to 14 August, there was some good news for the Wal-Mart–owned chain as its offloaded its loss-making photo division to Photo-Me International (LON:PHTM) for up to £6mln.
Photo-Me shares were flat at 162.6p.
Junior oiler Jersey Oil & Gas PLC (LON:JOG) was one of the top gainers, spurting almost 13% higher to 34.6p as it revealed a new farm-out deal.
It is bringing in Norwegian major Statoil into the North Sea exploration projects.
Statoil is to take 70% of UK Seaward Licence P.2170, Blocks 20/5b and 21/1d in the Central North Sea. The project is estimated to host over 500mln barrels of oil in place, across two prospects estimated at 300mln and 212mln barrels each.
Other risers included hydrogen fuel specialist ITM Power plc (LON:ITM) on the back of another contract to supply hydrogen fuel for commercial vehicles.
Office supplies business Commercial Group will use ITM’s refuelling stations to power its fleet of delivery vehicles.
ITM shares rose by 9% to 24.45p.
Tethys Petroleum Ltd (LON:TPL, TSE:TPL) leapt 83% to 2.27p as its proposed recapitalisation cleared a regulatory hurdle in the Cayman Islands.
London open
UK shares were on the up as traders look to the Wyoming symposium stateside later in the week and received positive European manufacturing data.
There was some good company news about too.
Junior oiler Jersey Oil & Gas PLC (LON:JOG) was the top gainer in London, spurting almost 20% higher to 36.5p as it revealed a new farm-out deal.
It is bringing in Norwegian major Statoil into the North Sea exploration projects.
Statoil is to take 70% of UK Seaward Licence P.2170, Blocks 20/5b and 21/1d in the Central North Sea. The project is estimated to host over 500mln barrels of oil in place, across two prospects estimated at 300mln and 212mln barrels each.
The FTSE AIM 100 is up over 15 points at the time of writing at 3,780, while the FTSE AIM All share added over two points to 790.970.
On the blue chips, FTSE100 is up over 28 at 6,856 with property firms running away with the medals.
Housing back in focus again and Persimmon PLC (LON:PSN) is up 3.12% to 1,850p after it cheered investors with better than expected pre-tax profits.
In the six months to June, pre-tax profit rose 29% to £352.3mln on a 12% boost to revenue to £1.49bn.
Legal completions increased 6% to 7,238 new homes sold while the average selling price grew 6% to an average of £205,762.
Broker Liberum said that the improved sales rate showed that customers in Persimmon's markets – outside of London- appeared to be shrugging off Brexit uncertainties. See our story here..
The news cheered others in the sector and Barratt Developments plc (LON:BDEV) added 3.48% to 479.40p. Taylor Wimpey (LON:TW.) and Berkeley Group plc (LON:BKG) were also higher.
Both France and, importantly Germany, reported positive manufacturing data this morning, which is giving confidence to the market that the predicted impact on demand post the Brexit vote has not yet materialised.
Traders are of course gearing up for Fed chair Janet Yellen's speech on Friday at Jackson Hole, where interest rates and a possible rise this year will be very much on the cards.
Snapshot at 8.15am
The FTSE 100 was 27 points to the good this morning at 6,856, managing to claw back most of yesterday's losses.
The top winner was Persimmon (LONPSN), up 2.5% to 1,837p after the housebuilder reported better-than-expected pre-tax profits.
The biggest loser was Hikma Pharmaceuticals PLC (LON:HIK), down 1.6% to 2,275p.
News
Action Hotels enjoys a "positive" first half
Photo-Me set to snap up Asda business
Rank Group brushes aside Brexit after solid year
Preview at 6.57am
London’s leading shares are set to claw back some of yesterday’s losses this morning.
Spread betting quotes point to the FTSE 100 opening at around 6,844, up 15 points or so from yesterday’s close, thereby regaining half of the ground lost yesterday.
Wall Street was mixed overnight, with the tech-heavy Nasdaq Composite advancing 0.1% to 5,245, while the Dow and the S&P 500 were both slightly softer – the former down 0.1% at 18,529 and the latter 0.1% weaker at 2,183.
Investors are adopting a wait-and-see posture ahead of this Friday’s speech by Janet Yellen, chair of the Federal Reserve, at the central bankers symposium at Jackson Hole.
In Asia, the Nikkei 225 was down just over a hundred points in the last hour of trading at 16,494, with exporters out of favour as the yen made headway overnight.
In Hong Kong the Hang Seng was 89 points lower at 22,909.
On the economic front, it is a big day across the globe for Purchasing Managers’ Indices.
Closer to home, focus will be on trading updates from The Rank Group PLC (LON:RNK), after it recently decided not to press on with its takeover bid (in partnership with 888) for bookie William Hill, and Persimmon PLC (LON:PSN), the house builder.
Around the markets
Crude –The front-month futures contract for Brent crude was down 1%, or 47 cents, at US$48.69 a barrel this morning, ahead of the American Petroleum Institute’s weekly update on oil stockpiles.
Gold – Gold for September delivery was trading at around US$1,341 an ounce, up $3.30 or 0.25%.
Sterling – The pound has edged higher against the greenback to US$1.3138.
Headlines
Renesas Electronics, the world’s third-largest producer of automotive microchips, is considering acquiring US rival Intersil – Financial Times
Oil falls as hopes of output freeze fade – The Times
House prices to fall in 2017 as Brexit uncertainty takes hold – The Independent
Egdon boosts stake in North Yorkshire gas field with shale potential – The Daily Telegraph
More than 1.5 million U.K. households in extreme debt, says TUC report – The Guardian
Last 35 BHS stores to close this week after 88 years on the High Street: - Daily Mail
Wonga to get a new UK boss – City AM