London stocks rise on earnings boost, virus worries cap gains
Reuters
Published Jan 14, 2021 08:36
Updated Jan 14, 2021 10:45
By Shashank Nayar
(Reuters) - British shares gained on Thursday as a slew of upbeat corporate earnings supported investor sentiment at a time when rising cases of COVID-19 and fresh lockdowns across Europe raised concerns about fiscal health.
However, gains were capped as a major chunk of the global recovery in companies' earnings expected in the first quarter is at risk of being pushed back further as virus curbs cloud hopes of a swifter economic rebound, investment banks said.
The blue-chip FTSE 100 index gained 0.5%, with mining and real estate stocks gaining the most.
"Markets have been on a hold-and-see mode this week ahead of the earnings season, with most traders holding back until they see something more solid in terms of added fiscal support," said Keith Temperton, an equity sales trader at Forte Securities.
The mid-cap index gained 0.7%.
The FTSE 100 has recorded consistent monthly gains since November, supported by hopes of a vaccine-led economic recovery, but it has recently lost steam as a wave of coronavirus infections sparked new business restrictions.
A boom in Britain's housing market has started to fade, dampened by new COVID-19 lockdowns and the coming expiry of a temporary tax cut for buyers, a survey showed.
Homebuilder Taylor Wimpey (LON:TW) dropped 1.2% even after saying its 2020 operating profit would meet market expectations, while Premier Inn-owner Whitbread (LON:WTB) gained 3% and jumped to the top of the FTSE 100 on lower job cuts than earlier expected.
Tesco (LON:TSCO), Britain's biggest retailer, fell 1.5% even as it reported a buoyant Christmas trading, while fashion retailer Boohoo slipped 1.3% even after raising its annual revenue target.
Primark owner AB Foods (LON:ABF) slid 0.7% on risks of an additional hit of 500 million pounds ($682.00 million), on top of the 1.05 billion pounds damage it is expecting to Feb. 27, if stores remain closed till end of March.
($1 = 0.7331 pounds)
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Written By: Reuters
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