Markets hopeful of a Biden presidency and Republican senate
Investors in London were optimistic that Joe Biden could take the White House but keep tax cuts with a Republican-controlled Senate, as markets closed on Wednesday.
And despite the presidential results from key states still not declared by closing, the London Stock Exchange’s blue-chip index closed the day up.
The FTSE 100 had a rocky day, bouncing up and down – as much as 1% off at points – as new data and results emerged from the US, but eventually closed out up 96.49 points, or 1.7%, at 5,883.26.
German and French traders were equally optimistic, with the French Cac 40 closing up 2.4%, and Frankfurt’s Dax 30 climbing 2%.
“It appears that once again investors are buying into a Joe Biden presidency, despite the race – which could still have days left in it yet – being on a knife-edge,” SpreadEx analyst Connor Campbell said.
He added: “Investors seem to be taking a kind of win-win attitude to the election. Yesterday’s growth was based on the hopes of a blue wave-led stimulus package.
“Now that the race is much tighter, and the Democrats have little chance of taking the Senate, the markets are celebrating the likelihood of preserved tax cuts and no healthcare reform.”
In company news, investors welcomed the news that the UK Government could end up rolling out a vaccine developed by AstraZeneca as early as next month. Shares in AstraZeneca closed up 548p at 8,511p.
Shareholders in Marks & Spencer were pleased to hear that sales at the high street retailer held up over the past six months, helped by the timely launch of the company offering grocery delivery via its Ocado joint venture.
Despite falling to a loss for the first time in its history – a pretax loss of £87.6 million – shares closed up 4.5p, or 4.9%, at 96.5p.
Revenue for the six months to September declined 16% to £4.09 billion from £4.86 billion a year before, which was less than first feared.
Lloyds Banking Group announced plans to cut another 1,070 jobs as part of its major restructuring programme to “adapt to customers’ changing needs”. Shareholders took flight, with shares closing down 0.725p at 28.52p – a fall of 2.5%.
Construction firm Morgan Sindall raised its profit outlook revealing it had seen a strong bounceback in business following the end of the spring lockdown.
Bosses also insisted the second English national lockdown will have “minimal impact” on the group – impressing investors enough for shares to close up 86p at 1,250p.
And even ballooning losses at London Southend Airport owner, Stobart Group, was not enough to dampen spirits, with shares closing up 1.39p – or 7.4% – at 20.15p.
Shareholders were happier to take comfort from the bullish update in which bosses said they expect to bounce back from the falls.
The biggest risers on the FTSE 100 were AstraZeneca, up 548p at 8,511p; Avast, up 29.6p at 500p; Ocado, up 131p at 2,561p; Next, up 302p at 6,092p; and Auto Trader, up 26.6p at 594.4p.
The biggest fallers were Standard Chartered, down 17.6p at 354.9p; CRH, down 130p at 2,820p; HSBC, down 14.4p at 332.45p; Barclays, down 2.98p at 110.38p; and Lloyds Banking Group, down 0.725p at 28.52p.