London close: FTSE rises as mining, oil majors gain; Brexit negotiations underway

19 June 2017

(ShareCast News) - London stocks pressed ahead to a positive close as the UK began formal divorce talks with the European Union, and as the shares of multi-commodity miners and oil majors decided overall direction.
Gains in the prices of industrial metals and crude oil proved beneficial for stocks in those sectors, these evident among the bigger blue-chip risers.

At the end of the session, the <strong>FTSE 100 was up 0.81% to 7,523, and the FTSE 250 had edged higher by 0.29% to 19,873.30</strong>. Across the channel, the Euro Stoxx 50, Dax and Cac 40 were all ahead. Wall St was making positive progress in its opening deals, too.

"We should start Brexit talks every day, it seems. The long-awaited beginning of discussions between the UK and the EU has been greeted with an impressive bounce for both UK and European stocks," said <em>IG</em> chief market analyst Chris Beauchamp.

"The rally today has been broad-based, with European markets seeing a return of buyers after weeks of indecision," said Beauchamp. He noted the weaker euro and sterling had made life easier for stocks in the Eurozone and UK, respectively.

David Madden, market analyst at <em>CMC Markets UK</em>, said it appeared that Brexit talks had begun well when the UK's Brexit secretary, David Davis, and EU chief negotiator Michael Barnier met.

"The process of extracting the UK from the EU, will certainly be time consuming, so investors aren't waiting for some fast agreement, but as the process is staggered, they will be paying close attention at every turn," said Madden.

Over in France, President Emmanuel Macron's party won a clear parliamentary majority, weeks after his own presidential victory. His La Republique en Marche won more than 300 seats in the 577-seat National Assembly.

Also on Monday, the latest research from Rightmove revealed that asking prices for houses in the UK were being cut at the sharpest rate in over four years amid political and economic uncertainty, with London and the southeast underperforming the rest of the UK.

In corporate news, <strong>Barclays</strong> advanced as the Serious Fraud Office was expected to announce as soon as Tuesday whether it had decided to bring criminal charges against some of its bankers in relation to its emergency fundraising at the height of the financial crisis.

Retailers <strong>Sainsbury</strong> and <strong>Marks &amp; Spencer</strong> were in the black, recovering from a slump at the end of last week on news of <strong>Amazon</strong>'s $13.7bn deal to buy Whole Foods Market.

Security services company <strong>G4S</strong> was the standout gainer as it made its way back into the top-flight index, with the shares having enjoyed a healthy rise following its demotion to the FTSE 250 in December 2015 after several botched contracts.

Heating and plumbing products distributor <strong>Wolseley</strong> was higher ahead of its third quarter update on Tuesday. UBS said: "We expect group Q3 like-for-like revenue growth of 4.5%, driven by the US +6%.

<strong>InterContinental Hotels</strong> was hit by a downgrade to 'neutral' from 'outperform'' at Credit Suisse, mostly on valuation grounds. It highlighted a 40% re-rating since early 2016 and said that otherwise, it sees a balanced backdrop of positive and negative risks for "one of the highest quality companies we cover".

In property, <strong>Hammerson</strong>, <strong>British Land</strong> and <strong>Land Securities</strong> were under the cosh as the latest research from Rightmove revealed that asking prices for houses in the UK were being cut at the sharpest rate in over four years amid political and economic uncertainty, with London and the South East underperforming the rest of the UK.

<strong>Market Movers</strong>

FTSE 100 (UKX) 7,523.81 0.81%
FTSE 250 (MCX) 19,873.30 0.29%
techMARK (TASX) 3,608.37 0.36%

<strong>FTSE 100 - Risers</strong>

G4S (GFS) 335.90p 4.58%
Glencore (GLEN) 287.95p 2.93%
Wolseley (WOS) 4,881.00p 2.50%
Standard Life (SL.) 399.10p 2.39%
Sainsbury (J) (SBRY) 258.00p 2.26%
Rentokil Initial (RTO) 286.40p 2.25%
Anglo American (AAL) 986.20p 1.95%
Rolls-Royce Holdings (RR.) 924.50p 1.87%
BHP Billiton (BLT) 1,179.50p 1.81%
Barclays (BARC) 206.75p 1.72%

<strong>FTSE 100 - Fallers</strong>

Hammerson (HMSO) 594.00p -1.33%
Paddy Power Betfair (PPB) 8,525.00p -1.10%
Pearson (PSON) 705.50p -1.05%
easyJet (EZJ) 1,349.00p -0.95%
Direct Line Insurance Group (DLG) 366.50p -0.95%
Land Securities Group (LAND) 1,057.00p -0.94%
InterContinental Hotels Group (IHG) 4,395.00p -0.88%
3i Group (III) 904.00p -0.82%
Fresnillo (FRES) 1,536.00p -0.71%
ITV (ITV) 177.60p -0.67%

<strong>FTSE 250 - Risers</strong>

Ocado Group (OCDO) 306.40p 11.10%
Aberdeen Asset Management (ADN) 299.70p 5.01%
Kaz Minerals (KAZ) 493.30p 4.62%
Evraz (EVR) 181.10p 4.14%
Sirius Minerals (SXX) 33.69p 3.91%
Capita (CPI) 670.50p 3.87%
PZ Cussons (PZC) 348.70p 3.47%
B&amp;M European Value Retail S.A. (DI) (BME) 350.90p 3.24%
Sophos Group (SOPH) 444.90p 3.19%
Northgate (NTG) 537.50p 3.07%

<strong>FTSE 250 - Fallers</strong>

Cairn Energy (CNE) 178.20p -5.01%
FirstGroup (FGP) 135.10p -4.59%
Nostrum Oil &amp; Gas (NOG) 479.70p -4.36%
Clarkson (CKN) 2,583.00p -3.58%
Telecom Plus (TEP) 1,203.00p -3.30%
Rank Group (RNK) 237.40p -3.16%
Mitchells &amp; Butlers (MAB) 234.70p -2.62%
AA (AA.) 216.20p -2.57%
Domino's Pizza Group (DOM) 315.50p -2.53%
Morgan Advanced Materials (MGAM) 300.80p -2.53%