London markets edge to gains despite afternoon downturn

The London markets finished a touch higher despite the FTSE and pound both losing steam after a surging start to the session.

Travel and leisure stocks rebounded after a poor showing on Monday, helping to offset underperformances by major firms such as Vodafone.

The FTSE 100 closed 1.39 points higher, or 0.02%, at 7,034.24 on Tuesday.

Michael Hewson, chief market analyst at CMC Markets, said: “It’s been another fairly subdued day of trading for markets in Europe, as an initially strong start and a new record high for the DAX soon gave way to some intraday profit taking, and a mixed finish to the day.

“The FTSE 100 briefly managed to push above the 7,100 level before retreating, with telecoms acting as the biggest drag, as Vodafone shares took a bit of a pummelling after falling a little short on expectations.”

On Tuesday morning, the Office for National Statistics had also buoyed sentiment among currency traders as it revealed that the jobless rates decreased for the first quarter of 2021.

It revealed that the rate of unemployment dipped back to 4.8% as the number of workers on payrolls surged for the fifth consecutive month, sending the pound to its highest since February before a major lull in the afternoon pulled it lower.

The pound decreased by 0.19% versus the US dollar to 1.418 and was down 0.08% against the euro at 1.162.

The Dow Jones was robust on the opening bell despite the weak dollar, which was near to its own February lows.

In mainland Europe, the other largest markets closed in the red as they were caught up in the afternoon slump in trading sentiment.

The German Dax decreased by 0.07% and the French Cac moved 0.21% lower.

In company news, Vodafone was the day’s heaviest faller as investors were left unimpressed after it saw sales fall on the back of low roaming charges due to travel restrictions and holiday cancellations.

The telecoms firm revealed a 2.6% fall in revenues for the year to the end of March to 43.8 billion euro (£37.6 billion) as it was also impacted by high street closures.

Shares in the company were 12.62p lower at 129.08p at the close of trading.

Pork and poultry firm Cranswick made significant gains after it revealed that more barbecues and full English breakfasts helped to improve sales and profits over the past year.

The East Yorkshire firm saw shares rise by 286p to 4,000p after it said it would increase its dividend pay-out and hand out an improved staff bonus due to the performance.

Retailer Shoe Zone saw shares sink by 6.5p to 67.5p after it reported a 41% sales decrease for the past six months.

The price of oil dipped amid continued caution about cases in India and how the Indian variant could impact on travel demand from the UK and other countries.

The price of Brent crude decreased by 0.32% to 69.24 dollars per barrel.

The biggest risers on the FTSE 100 were IAG, up 6.88p at 196.56p, Sage Group, up 20.2p at 663.4p, JD Sports, up 24.6p at 920p, and Natwest, up 5.15p at 198.55p.

The biggest faller on the index were Vodafone, down 12.62p at 129.08p, Antofagasta, down 88p at 5.17p, Fresnillo, down 21p at 894.8p, and DCC, down 106p at 5,990p.