Budget helps London markets climb despite Wall Street caution

Henry Saker-Clark, PA City Reporter

The London markets made gains after traders welcomed the Chancellor’s latest financial support but closed behind morning highs after US caution weighed on global stocks.

The latest US services data disappointed traders, with a flat reading for February missing expectations of a small uplift in activity.

Nevertheless, it was not enough to drag the FTSE too significantly, as the extension of furlough particularly helped to buoy trading.

The FTSE 100 closed 61.72 points, or 0.93%, higher at 6,675.47 on Wednesday.

Connor Campbell, financial analyst at Spreadex, said: “The FTSE, and the rest of the European markets, were a long way off their morning highs post-US open.

“What started as a very strong session – continuing the rebound that opened the month – turned into a bit of a mixed bag as Wednesday wore on.”

The Dow Jones opened lower after the Institute for Supply Management’s services PMI came in at 55.3.

The other major European markets were particularly cautious at the close, with the recent bullish run losing pace this week against London.

The German Dax increased by 0.25% and the French Cac moved 0.35% higher.

Sterling made gains despite a firmer dollar as traders were optimistic about the UK’s potential economic recovery.

The pound increased by 0.04% versus the US dollar to 1.396 and was up 0.22% against the euro at 1.156.

Housebuilders like Redrow, Taylor Wimpey and Barratt Developments moved higher after the Chancellor confirmed a stamp duty extension and new deposit guarantee scheme.

In company news, Hiscox plummeted in value after the insurance giant said Covid-19 claims would drag it to a 268.5 million dollar (£193 million) loss.

The company admitted its court wrangle with businesses making claims over the impact of the pandemic meant it “suffered some brand damage” this year.

Shares closed 116.2p lower at 865.2p.

UK technology firm Micro Focus soared after it signed a commercial agreement with Amazon’s cloud platform arm.

Shares moved 59.7p higher to 498.3p at the end of trading after it said the two will work to use Micro Focus technology for customers looking to shift some workloads to a cloud-based production environment.

Cybersecurity firm Avast slipped after reporting solid improvements in revenues and earnings.

It closed 13.2p lower at 451p despite posting that revenue increased by 2.5% to £892.9 million and adjusted earnings ticked up by 2.6% to £495.5 million.

The price of oil surged after the latest EIA report showed that US oil inventories jumped by 21.5 million barrels and the consensus estimate was for a draw of more than 900,000 barrels

The price of Brent crude oil increased by 2.62% to 64.34 dollars per barrel.

The biggest risers in the FTSE 100 were Barratt Developments, up 48.4p at 732.6p; Persimmon, up 185p at 2,895p; IAG, up 13.8p at 216.5p; BT, up 8.5p at 134.4p; and Taylor Wimpey, up 9.95p at 175.85p.

The biggest fallers were Avast, down 13.2p at 451p; Scottish Mortgage Investment Trust, down 32p at 1,162p; Severn Trent, down 55p at 2,168p; SSE, down 31p at 1,301.5p; and National Grid, down 18p at 810.2p.