- FTSE falls 18 points, or 0.24%
- Omicron wildcard playing with market sentiment
- Flutter Entertainment the day’s top performer
5:00 pm: FTSE 100 closes lower
The FTSE 100 closed lower Thursday as investors weighed Omicron’s impact on businesses while US markets moved higher.
At the close, the UK blue-chip index fell 18 points, or 0.24%, to hit 7,403.
Joshua Mahony, senior market analyst at online trading group IG, said that US markets continue to grind higher as lower unemployment claims and a rise in the Chicago PMI surveys are improving sentiment heading into the close of 2021.
“Market sentiment continues to straddle fears of near-term Covid restrictions and expectations of a swift recovery, with value and growth names fluctuating as a result. Nonetheless, the move towards higher rates and higher yields should bring a rare period of outperformance for value names once the Omicron wave starts to subside,” he said.
Mahony added: “Today brought a rare data point worth considering, with unemployment claims dropping back below the 200k threshold for just the third time in 22-months. Next week brings the latest US jobs report, with traders keeping an eye out for signs that the Omicron wave is having a detrimental impact on the economic recovery.
Crucially, we are seeing businesses attempt to stockpile in a bid to overcome supply chain disruptions that have dominated recent months. Notably, this December strength does help lift sentiment as traders await signals over just how hard companies have been hit over this festive period.”
The top gainer was Flutter Entertainment, which increased by 3.31% to 117.25p.
15:45pm: FTSE 100 turns lower whilst FTSE 250 and AIM 100 hold modest gains
The FTSE 100 turned lower in mid-afternoon trade, down 7.5 points changing hands at 7,413.
Plant hire firm Ashstead Group Plc was the day’s biggest faller, losing 2.22% to 5,986p, followed by Berkeley Group, Melrose Industries and Royal Mail all down around 1%.
Discount retailer B&M similarly dropped just over 1% as did Spirax-Sarco and London Stock Exchange Group.
Bookies Flutter Entertainment and Entain were among the day’s top risers, up 2.16% and 1.51% respectively.
International mining major Rio Tinto rose by 1.7% to 4,929p whilst Premier Inn and Beefeater owner Whitbread added 1.18% to 3,003p.
London’s FTSE 250 notched 20 points higher to 23,538 whilst the FTSE AIM 100 was 34 points higher.
Over in New York, US blue chips edged higher in early trade.
US sentiments were helped by solid weekly jobless claims data indicating that a recent rise in COVID-19 infections hasn’t led to a surge in layoffs.
The Dow Jones Industrial Average was 122 points, or 0.3% higher at 36,611, while the broader S&P 500 added 0.1%, though the tech-laden Nasdaq Composite was flat.
12:20pm: FTSE 100 holds positive ground, Wall Street set for quiet start
The FTSE 100 held positive territory at midday ahead of what’s expected to be a quiet start in the United States.
London’s blue-chip benchmark was up just 6 points at 7,426.
Wall Street stocks are expected to open fairly flat as investors await the latest US weekly jobless claims data for clues as to how the rise in Omnicron coronavirus (COVID-19) variant infections is hurting the labor market.
Futures for the Dow Jones Industrial Average were flat, while those for the broader S&P 500 ticked up less than 0.1%, but contracts for the tech-laden Nasdaq-100 edged 0.2% higher.
Despite COVID-19 cases hitting a record in the US, some investors expect that high vaccination rates and signs of milder symptoms caused by the Omicron variant mean the economy will avoid a repeat of the disruption seen at the start of the pandemic. Policymakers are focused on hospitalizations rather than cases and are seeking to avoid stricter containment measures.
Jeffrey Halley, senior market analyst, Asia Pacific at OANDA commented: "Omicron fears continued to fade overnight, in North America at least, propelling the S&P 500 and Dow Jones to record closes, lifting oil prices, and weighing on the US Dollar.
10:30am: FTSE 100 crawls into positive territory, helped by Lloyds
A bit of enthusiasm for mining stocks and a tidy gain for Lloyds Banking Group PLC (LSE:LLOY) into positive territory.
Before you start booking your summer holidays on the back of assumed gains in your portfolio, the Footsie’s gain is a mere 5 points (0.1%) at 7,426.
Retail investors’ favourite Lloyds is up 0.7% at 48.33p; banks are expected to benefit from rising interest rates.
Rio Tinto PLC (LSE:RIO), up 1.3% at 4,908p, is the top riser among FTSE 100 constituents while precious metals miner Fresnillo PLC (LSE:FRES) is the next best blue-chip performer in the commodities sector with a 0.9% rise to 880.2p.
Among the smaller metals plays, Galileo Resources PLC (AIM:GLR) has caught the eye with its plans to run the rule over a copper project in Zambia. The shares are up 18% at 1.15p.
READ Galileo Resources shares surge as it announces option to invest in Zambian copper project
8.45am: Sleepy start
Aerospace and travel stocks are out of favour again, which had led to the FTSE 100 opening slightly in the red.
London’s index of heavyweight shares was down 10 points (0.1%) at 7.411.
British Airways owner International Consolidated Airlines Group (LSE:IAG) SA and aerospace engineer Melrose Industries PLC (LSE:MRO, OTC:MLSPF) were among the worst blue-chip performers, with the former off 1.3% at 141.66p and the latter down 0.9% at 156.5p.
The lack of enthusiasm for these stocks comes after 183,037 Covid-19 cases were reported on Wednesday for the UK, which is a new high, although the numbers might be inflated by a clearing of a backlog of tests.
The Nationwide building society released its house price index data today and the figures showed the average price of a purchased house rose to £254,822 in December from £252,687 in November.
“The price of a typical UK home is now at a record high of £254,822, up £23,902 over the year - the largest rise we’ve seen in a single year in cash terms. Prices are now 16% higher than before the pandemic struck in early 2020,” said Robert Gardner, Nationwide’s chief economist.
7.30am: FTSE 100 set for lackadaisical start
US indices may have hit a new high yesterday but the Footsie looks like it may have checked out for the year already.
Spread betting quotes indicate London’s index of top shares will open around 6 points lower at 7,415.
Yesterday, the Dow Jones industrial average rose 90 points to 36,489 and the S&P 500 7 points to 4,793.
“Omicron fears continued to fade overnight, in North America at least, propelling the S&P 500 and Dow Jones to record closes, lifting oil prices, and weighing on the US Dollar. Even gold managed to recoup most of its intra-day losses as optimistic long positions were once again culled,” said Jeffrey Halley at OANDA.
In Asia, the Nikkei 225 in Tokyo fell 115 points to 28,792 while in Hong Kong the Hang Seng was 16 points heavier at 23,103.
As might be expected in the twilight zone between Christmas and the New Year, the agenda is pretty thin.
“Tonight's US Initial Jobless Claims will be of passing interest, a fall below 200,000 for the weekly number likely reinforcing the bullish sentiment dominating markets. Far more important will be China’s official Manufacturing and Non-Manufacturing PMIs for December released tomorrow morning,” commented (as opposed to cometed) that man Mr Halley again.
Around the markets
- Sterling: US$1.3474, down 0.17 cents
- 10-year gilt: 1.017%, up 9.42 basis points
- Gold: US$1,796 an ounce, down US$9.20
- oil: US$79.08 a barrel, down 13 cents
- Bitcoin: US$47,054, down US$141
- Ethereum: US$3,716, down US$9