FTSE 100 Live: Markets surge as Omicron fears ease, house prices up again, Elliott goes public in SSE battle

·9 min read
 (ESI)
(ESI)

Stock market concerns about Omicron continue to ease after US infectious disease expert Dr Anthony Fauci said initial data on the new variant appeared to be encouraging.

The FTSE 100 index rose another 1% after Asia markets also benefited from strong trade figures in China.

Today's session in London includes the latest house price figures from the Halifax, with November’s average of £272,992 up for a fifth month in a row and 8.2% higher compared with a year ago.

FTSE 100 Live Tuesday

  • FTSE 100 back to pre-Omicron level

  • House prices continue to rise

  • Elliott steps up pressure on SSE

House and jobs markets put pressure on Bank of England

14:00 , Simon English

FIRM evidence that the economy was performing strongly before the emergence of the Omicron variant emerged today, giving Bank of England policy makers another headache.

The Bank is weighing up whether it dare put up interest rates to head-off soaring inflation. It remains concerned that doing so would hit the economic recovery.

Today there were strong signals from the banking, housing and recruitment sectors that the UK was booming, at least until very recently.

Halifax reported that house prices are rising at the fastest rate since 2006; 1% in November alone and 3.4% in the last quarter.

read more here

GSK drug defeats omicron, report

13:54 , Simon Freeman

GSK today said its antibody treatment for Covid-19 is effective against omicron despite the new variant's high level of mutations.

The drug-maker reported results of pre-clinical studies carried out in a laboratory which suggest sotrovimab retains activity against all 37 mutations so far identified in the virus coat's spike protein.

The findings, which have not been peer review and were published in an update to the stock market, contributed to a rally across world markets which lifted the FTSE100 to its highest level since omicron's discovery spooked investors last month.

FULL DETAILS HERE

Astra piles another £3bn into rare diseases

12:08 , Simon Freeman

AstraZeneca has further expanded its drive into the market for expensive to make (and therefore expensive to try to copy) treatments for complex rare diseases.

It has signed a deal worth a potential $3.6bn with California’s Ionis to bring a promising treatment for an incurable liver condition to market.

Ionis was launched by the former head of research at Astra’s rival GSK.

Full story here

Comment: Elliott doesn’t just park its tanks.. it fires them

11:47 , Simon Freeman

Our daily column in the paper focuses on the battle at SSE today:

“Of course, Elliott Advisors isn’t going quietly.

The activist is kicking up an almighty fuss after SSE declined to take its private advice and spin-off its renewables business.

Not only does the decision beggar belief, keeping SSE intact calls into question the competence of management, we are told. Time to get in some new directors who know what they are doing, say Elliott.

This is all textbook stuff.”

You can read the full article here.

SSE responds to latest Elliott calls

11:24 , Simon Freeman

SSE has issued a statement responding to the latest calls for change at the company from activist investor Elliott.

Safe to say, they’re not hugely impressed.

CEO Alistair Phillips-Davies said: “Separation risks valuable growth options across the clean energy value chain, would jeopardise our ability to finance and deliver the major infrastructure the UK needs to create jobs and achieve net zero, and would lose shared skills that benefit the group.

“Separation does not support the financing of our core growth businesses and would rule out adjacent growth options, as well as reducing the resilience of the business model – it is not the right outcome to maximise value for shareholders or our other stakeholders.”

FTSE 100 recovers to pre-Omicron level

10:40 , Graeme Evans

Stock market investors shed more of their Covid-19 worries today as the FTSE 100 index rallied back to where it was prior to the detection of the Omicron variant.

Even though infections are spreading fast and scientists still have much to learn about the new variant, the hope among traders is that the strain will only trigger mild symptoms.

Their optimism helped the FTSE 100 to lift more than 1% or 85.44 to 7317.72, just above the level prior to the 3.6% rout on November 26 when oil prices tumbled on fears the global economy faced another wave of Covid-19 restrictions.

Brent crude futures have since recovered to $75 a barrel, with sentiment given a further lift today by monthly trade data pointing to a recovery in China's domestic demand.

The figures triggered a wave of buying in the commodities sector, particularly stocks focused on iron ore following gains of more than 3% for Rio Tinto and BHP.

North American plumbing supplies business Ferguson, which used to be known as Wolseley, joined them at the top of the FTSE 100 after a 64% jump in first quarter operating profits.

Ongoing stimulus efforts behind the US economy also helped Sunbelt plant hire business Ashtead to post strong figures, sending its shares 3% higher in the process.

As well as favourable trends as companies choose to rent rather than own their equipment, the company got $60 million (£45 million) of revenues from hurricane repair work in the US.

Its second quarter profits rose 17% to £474 million, leading to a 28% jump in the half-year dividend. Shares rose 178p to 6376p, which is close to a record high.

The FTSE 250 improved 1% or 232.64 to 23,113.97, although the domestic-focused second tier is still 100 points short of where it was prior to the Omicron discovery.

Big risers included Cineworld and bootmaker Dr Martens, with the latter up 5% or 18.2p to 406.8p.

MoD supplier Babcock International, which owns and operates the Devonport and Rosyth dockyards, also rose 1.2p to 308p on signs that its turnaround strategy is on track.

Half-year results showed a return to the black, with chief executive David Lockwood pleased with progress rebuilding the balance sheet.

Sports data firm 4Global receives healthy AIM welcome

10:17 , Naomi Ackerman

Sports data company 4Global received a healthy welcome when it joined AIM this morning.

The Chiswick-based firm, which aims to encourage people to get more active on understanding their fitness patterns, floated on London's junior market at 91p per share. Shares were trading at 95p per share by mid-morning.

The listed raised £4 million for the company, which works with governments and gyms to promote fitness and recently signed a licensing contract with Sport England.

4Global has a market cap of around £24 million.

Chief executive Eloy Mazon said: "We are delighted to have achieved this key milestone for the Company and to welcome our new and supportive shareholders alongside us in our growth journey."

Elliott goes public in SSE battle

09:15 , Oscar Williams-Grut

The activist investor stalking SSE today broke cover to blast the energy giant’s management and increase pressure on the company to spin-off its renewables business.

Elliott Advisors today published a letter sent to SSE’s chairman Sir John Manzoni calling for the company to spin-off or sell at least part of its renewables business, beef up its board and appoint a new strategy committee to draw up more ambitious plans for SSE’s future.

It marks the first public salvo from Elliott after months of behind-closed-doors talks between the US activist and SSE’s management. Elliott has built a significant stake in SSE and is now among the company’s top five shareholders. Elliott has been privately lobbying for SSE to split itself in two by spinning out its fast-growing renewables business and leaving the legacy network infrastructure business as the core.

Read the full story.

FTSE 100 steps up recovery

08:41 , Graeme Evans

The FTSE 100 index rose another 0.7%, leaving the top flight back near to where it was prior to the detection of the Omicron variant in southern Africa.

Shares have recovered globally on signs that the symptoms associated with the new variant are mild.

The FTSE 100 index rose 1.5% yesterday and added another 59.05 points to 7291.33 today, with shares in De Beers owner Anglo American among those up by 2% or more.

North America-focused plumbing supplies business Ferguson rose 4% at the top of the FTSE 100 index after reporting a 64% jump in first quarter operating profit.

Safe haven stocks including National Grid and Severn Trent featured on a shortened fallers board.

The FTSE 250 index climbed 193.32 points to 23,074.65, with Cineworld doing well after a 5% gain.

Average house price up 8.2% in a year

08:12 , Graeme Evans

The average UK property price hit another new record at £272,992 in November, Halifax revealed today.

The latest figure represents a monthly increase of 1%, or £2,808, and has tipped the annual rate of inflation up to 8.2%.

It is the fifth straight month that average house prices have risen, with typical values now up by almost £13,000 since June, and more than £20,000 since this time last year.

Read more here

Recovery hopes build as Asia markets rally

07:38 , Graeme Evans

The FTSE 100 index is poised to consolidate Monday's 1.5% rise amid signs that cases of the Omicron variant have been mild so far.

Michael Hewson, of CMC Markets, said: “Indications still show that it isn’t prompting a big rise in hospitalisations and deaths, raising the hope that while it may be as transmissible as the common cold, that could be as bad as it gets.

“That hope certainly appears to be what drove yesterday’s market gains, with the FTSE 100 hitting its highest levels since November 26.

“However as the last week has shown us, while sentiment has been shown to be positive on one day, it doesn’t take too much to flip it on its head, and turn it negative the next.”

He expects the FTSE 100 index to open another 12 points higher at 7244.

Oil prices have continued to recover some of their recent lost ground, with Brent crude futures up another 1% to $73.77 a barrel as concerns about the impact of the Omicron on global economic demand start to ease.

There were also encouraging signs from China's economy after trade figures beat expectations, including a bigger-than-forecast 27.1% rise in exports in October.

Japan's Nikkei 225 index reflected the renewed optimism by closing 1.9% higher.