UK shares closed higher on Tuesday, extending gains from the previous session, while investors awaited the outcome of central bank meetings in Japan and the United States.
The US Federal Reserve will announce its decision on interest rates after London markets close on Wednesday, although the chances of rate rise diminished even further to around 20% after the latest US housing starts data disappointed on Tuesday.
The blue-chip FTSE 100 index ended up 0.3% at 6,830.
The biggest gainers among FTSE 100 shares were Burberry (LON:BRBY), up 3.6% at 1379p; Shire (LON:SHP), up 2.6% at 5315p; and Johnson Matthey (LON:JMAT), up 1.9% at 3272p.
London Fashion Week proved a welcome diversion for investors who were bracing themselves for central bank announcements later in the week.
Plenty of positive commentary surrounding Burberry's fashion show in London on Monday night helped lift the shares almost 3%, with the company also unveiling technical innovation alongside the floral prints and Victorian ruffles on the catwalk.
Johnson Matthey was moving back towards one-year highs set last month as platinum prices moved higher, up 1.5% as the precious metal traded 200% of its 20-day intraday average volume.
Meanwhile, the FTSE 250 index of mid-caps gained 0.1% to 17,900 and was led by GVC Holdings plc (LON:GVC) up 6.6% to 769p. Having been added to the FTSE 250 on Monday, online gaming and gambling group GVC Holdings said it was confident of achieving a result at the upper end of market expectations for 2016 after reporting a strong first half result. GVC more than doubled adjusted pre-tax profit to 51.3mln euros in the first six months of the year.
Second riser was Talktalk Telecom Group Plc (LON:TALK) up 3.7% to 204.2p.
Smaller stocks outperformed their larger brethren. The FTSE AIM 100 Index ended up 0.6% at 3,897 and the FTSE AIM All-Share Index was up 0.4% to 814.
London’s gaining stocks outnumbered losers 33% to 30% while a further 37% were unchanged.
Midsession
FTSE 100 is up over 37 points as traders looks to the moves, if any, by Central Banks on interest rates tomorrow.
The US Fed starts its meeting today and is expected to make an announcement tomorrow. The Bank of Japan will also report tomorrow.
FTSE 100 is at 6,850, up over 37 points. Elsewhere, in Europe, the German DAX and French CAC 40 are also higher.
In company news, Kingfisher plc (LON:KGF) had been a big riser on the day, but now down 2.31% to 367.90p as it posted an uplift in first half profits.
George Salmon, analyst at stockbroker Hargreaves Lansdown, said: "So far this year, the French businesses have disappointed, but the group’s UK performance is strong and momentum is building in other international markets, particularly Poland.
"In the longer term however, it is the relative success of Kingfisher’s own DIY improvement plans that will dictate the group’s future."
In small caps, US focused oiler Nighthawk Energy (LON:HAWK) was a notable gainer, flying up 36% to 1.20p as it announced the settlement of litigation in the United States.
All claims arising out of agreements with Running Foxes Petroleum and related issues with its partner American Patriot Oil and Gas Inc are now settled, Nighthawk said. It sees the three parties released from all past, current, and future claims.
Minds and Machines Group ltd (LON:MMX) added almost 16% to 12.75p as it was optimistic after a transformational first half which saw revenues double and it launch into China while registrations for top level domains continue to grow.
Alongside its interims today, the AIM group also announced it would return £13mln to shareholders via a tender offer at 13p a share - an 18.2% premium to the closing price on September 16 and a subscription investment of £5.5mln by Chinese fund Goldstream Capital Master Fund I also at 13p.
On the losing front, Chaarat Gold (LON:CGH) dropped over 21% to 5.75p as it revealed the largest shareholder in Chaarat Gold Holdings Ltd (LON:CGH) was to join the board of the company as non-executive chairman.
The appointment of Martin Andersson, who holds his Charaat stake through Labro Investments, coincides with a refreshed statement of the planned path to production for the company’s flagship Tulkubash project in Kyrgyzstan.
An additional director, Martin Wiwen-Nilsson, an associate of Andersson, will also be appointed as a non-executive director.
FTSE 100 up at noon and Burberry top dog
FTSE 100 is up over 42 points at the midday point, with fashion group Burberry plc (LON:BRBY) leading the way.
Its shares are up 2.18% to 1,359p while FTSE 100 stands ahead 0.63%, or 42.57 points at the time of writing to 6,856.
Having earlier been top gainer, DIY retailer and Screwfix owner Kingfisher PLC (LON:KGF) was down 1.51% to 371p.
FTSE 100 rises on Tuesday, but GlaxoSmithKline shares drop as it names Emma Walmsley as new CEO
The spotlight was on GlaxoSmithKline Plc (LON:GSK) as it unveiled plans to make Emma Walmsley the FTSE 100’s top female boss, when she is promoted group chief executive.
Walmsley takes the Big Pharma’s top job in March, moving up from the consumer health business which she has run since joining from L’Oreal back in 2010.
She is likely to face questions over her plans for GSK given that Witty has had to rebuff demands from some shareholders to break up the business.
Already the appointment is being scrutinised, and the share price is down 11p, 0.6%, at 1,634p.
“Some more vocal shareholders had wanted an outsider appointed to help push through a change in GSK’s structure, and are selling shares in a show of disappointment,” said Jasper Lawler, analyst at CMC Markets.
The FTSE 100, at around 11:00, was up 35 points or 0.52% trading at 6,848.
FTSE 100 up as traders eye Central Banks
FTSE 100 is climbing higher at the open as traders digest some big corporate news and look to Central Banker moves tomorrow.
The UK big cap benchmark is up almost 20 at the time of writing, at 6,833. Small cap shares are also higher, with FTSE AIM 100 up 0.32% to 3,887 and the FTSE AIM All share up 0.15% to 812.860.
Michael Hewson at CMC Markets, said: "Today’s European open is likely to see a slightly softer open after yesterday’s paring back of oil prices from their intraday highs, as well as the fact that the latest Federal Reserve rate meeting gets under way later today."
In the US, many expect the Fed to not increase interest rates.
On the corporate front, DIY retailer Kingfisher (LON:KGF) was a notable riser, adding over 2% to 384.9p
Its half-year profits to end June rose 13.5% compared to last year to £436mln, helped by a strong performance from its Screw fix chain. The half year divided was lifted 2.2% to 3.25p.
Elsewhere, top level domain specialist Minds & Machines (LON:MMX) gained almost 15% to stand at 13.63p as it reported on a transformational first half which saw revenues double and it launch into China while registrations for top level domains continue to grow.
The firm said it would return £13mln to shareholders via a tender offer at 13p a share - an 18.2% premium to the closing price on September 16 and a subscription investment of £5.5mln by Goldstream Capital Master Fund I also at 13p.
Highlands Natural Resources Plc (LON:HNR) told investors that Schlumberger-led operations have now begun for a test of the group’s DT Ultravert well enhancement technology.
Robert Price, Highlands chief executive, said: “We are making good progress on the testing and commercialisation of DT Ultravert having commenced this Parent Well Protection Campaign.” Shares added over 10% to stand at 30.75p.
The top London gainer was PuriCore plc (LON PURI), an emerging specialty biopharmaceutical company, which said it had agreed to sell its Supermarket Retail Business subject to approval by shareholders. Shares surged over 27/% to 26.50p.
On the downward front, airline Fastjet (LON:FJET) dived almost 17% lower to 21p as its new chief executive outlined a major overhaul of strategy after a very tough six months.
Nico Bezuidenhout took over in August and has started already to scale back operations.
In particular, the current fleet of five Airbus 319s is to be replaced by three smaller aircraft while the head office is shifting to Johannesburg from Gatwick.
Risers & Fallers: PuriCore, Minds + Machines, Nighthawk Energy... https://t.co/XVjAiUMcq9 via @proactive_uk
— Giles Gwinnett (@Gile74) September 20, 2016
Opening snapshot at 8.30am
The FTSE 100 opened 12 points lower at 6,801.
The top winner was Kingfisher PLC (LON:KGF), up more than 3% to 142.75p.
Barratt Developments PLC (LON:BDEV), down almost 2% to 471p.
News
Kingfisher boost profits but warns on ‘Brexit’ jitters
Minds + Machines upbeat as it plans £13mln offer to shareholders
Sound Energy preparations underway for high impact Badile exploration well in Northern Italy
London is set for a low key start after only modest movements overnight on Wall Street and in Asia.
Financial spread bet firms see FTSE 100 dropping just a few points from Tuesday’s close of 6,813, which was a more than 100 point gain on the day.
Wall Street closed almost unchanged with the Dow Jones Industrial Average shedding just 4 to 18,120 and similarly small movements on Nasdaq and the S&P 500.
There was a bit more activity in Asia but like in the US the mood is being set by possible interest rate changes later this week.
Tokyo, Hong Kong and Shanghai all registered modest declines.
Kingfisher and PureCircle
After a quiet day for company news yesterday B&Q and Castorama owner Kingfisher plc (LON:KGF) posts half-year results.
Analysts expect the company to report underlying first-half pre-tax profit of £430mln before £30mln of restructuring costs.
Sugar substitute stevia specialist PureCircle Limited (LON:PURE) also reports final results on Tuesday.
Analysts expect PureCircle to update on growth in demand for sweetener derived from the leaf, which is used in soft drinks such as Coke Life and a range of foodstuffs.
Broker Numis Securities noted that stevia has now been approved for use in India and Brazil.
Commodities
Gold: Up US$ 3 to US$1,318
Silver: Up US$0.05 to US$19.20
Oil: WTI down US$0.27 to US$43.59
Headlines
Doctors told to reveal all income from private work (The Times)
Banks can cope with loss of EU passports after Brexit, says Moody's (Daily Telegraph)
Merkel admits she would turn back the clock on refugee policy (FT)