London open: FTSE nudges up as investors eye US election

5th Nov 2024 08:33

(Sharecast News) - London stocks were just a smidgen higher in early trade on Tuesday, with investors erring on the side of caution as Americans headed to the polls.

At 0900 GMT, the FTSE 100 was up just 0.1% at 8,189.53.

Matt Britzman, senior equity analyst at Hargreaves Lansdown, said: "There is a 'wait and see mood' on the markets as uncertainty weighs about the outcome of what appears to be a deadlocked US Presidential election. Campaigning is converging on the crucial swing state of Pennsylvania and the extent to which voters can be galvanised to join queues at polling booths could make all the difference.

"The dollar has been fluctuating but is still lower on the week, as Kamala Harris' chances have appeared to have improved. A pro-tariff Trump presidency could see the dollar strengthen amid concerns higher inflation will prompt the Fed to keep interest rates higher. There is likely to a period of volatility particularly if the result is contested, but investors should keep their eyes on long-term horizons as historically financial markets have risen over the course of both Democratic and Republican presidencies."

On home shores, data from the British Retail Consortium and KPMG showed that retail sales saw a modest increase in October, rising by 0.6% year-on-year.

In equity markets, water companies were on the rise on the back of positive research notes from both Citi and JPMorgan Cazenove, with Severn Trent, United Utilities and Pennon among the top performers.

Severn Trent was upgraded to 'neutral' at Citi, which also opened 90- day "positive catalyst watches" on United Utilities and Pennon into Ofwat's Final Determinations.

Meanwhile, Citi upgraded SVT and Pennon to 'overweight' and maintained its 'overweight' on UU.

Vodafone gained as the Competition and Markets Authority said the merger between it and Hutchison's Three UK could proceed "if appropriate remedies are implemented".

Primark owner Associated British Foods was higher as it posted a 33% jump in full-year adjusted pre-tax profit and announced a special dividend, with revenue growth in both the retail and food businesses.

Interdealer broker TP ICAP advanced as it reported record third-quarter revenue following strong performance in its Global Broking and Liquidnet businesses.

On the downside, Schroders tumbled as it reported net outflows of £2.3bn for the third quarter.

Morgan Advanced Materials fell after a trading statement, while Close Brothers was knocked lower by a research note from RBC Capital Markets, which added a "speculative risk" qualifier to its rating for the stock.

RBC said that if the Supreme Court upholds the Hopcraft judgement applying a broad interpretation, motor finance litigation could spread to other products like premium finance.

"CBG is the only bank in our coverage that has material exposure here (circa 10% of the loan book, 50% retail, 80:20 motor:home, respectively)," it said. "Our initial estimate of the potential liability for CBG - in the event of a bad outcome in respect of premium finance - is circa £250m, of which £100m has been included in our model."

Market Movers

FTSE 100 (UKX) 8,189.53 0.06%

FTSE 250 (MCX) 20,489.40 0.14%

techMARK (TASX) 4,615.36 0.05%

FTSE 100 - Risers

Severn Trent (SVT) 2,641.00p 2.76%

Melrose Industries (MRO) 487.00p 2.70%

United Utilities Group (UU.) 1,054.00p 2.63%

Vodafone Group (VOD) 73.50p 1.83%

Associated British Foods (ABF) 2,326.00p 1.62%

Rentokil Initial (RTO) 392.30p 1.58%

BT Group (BT.A) 144.30p 1.51%

Fresnillo (FRES) 732.00p 1.46%

Hiscox Limited (DI) (HSX) 1,073.00p 1.13%

3i Group (III) 3,233.00p 1.00%

FTSE 100 - Fallers

Schroders (SDR) 320.60p -11.83%

Entain (ENT) 727.40p -1.30%

Flutter Entertainment (DI) (FLTR) 17,585.00p -0.82%

Smith (DS) (SMDS) 548.50p -0.72%

Spirax Group (SPX) 6,505.00p -0.69%

AstraZeneca (AZN) 10,976.00p -0.60%

Scottish Mortgage Inv Trust (SMT) 870.80p -0.59%

F&C Investment Trust (FCIT) 1,054.00p -0.57%

Halma (HLMA) 2,481.00p -0.56%

Rolls-Royce Holdings (RR.) 546.60p -0.55%

FTSE 250 - Risers

Pennon Group (PNN) 559.00p 3.71%

TP Icap Group (TCAP) 234.00p 2.86%

Spirent Communications (SPT) 173.90p 2.60%

Crest Nicholson Holdings (CRST) 169.60p 2.48%

Schroder Asia Pacific Fund (SDP) 548.00p 2.05%

Twentyfour Income Fund Limited Ord Red (TFIF) 104.60p 1.55%

Drax Group (DRX) 634.00p 1.44%

Supermarket Income Reit (SUPR) 71.20p 1.42%

Fidelity China Special Situations (FCSS) 219.00p 1.39%

Bakkavor Group (BAKK) 147.50p 1.37%

FTSE 250 - Fallers

Morgan Advanced Materials (MGAM) 232.00p -4.72%

Close Brothers Group (CBG) 221.20p -2.04%

Burberry Group (BRBY) 835.20p -1.86%

Chrysalis Investments Limited NPV (CHRY) 85.60p -1.38%

Bankers Inv Trust (BNKR) 110.60p -1.07%

Finsbury Growth & Income Trust (FGT) 842.00p -1.06%

Impax Environmental Markets (IEM) 387.00p -1.02%

Renewi (RWI) 606.00p -0.98%

Hilton Food Group (HFG) 932.00p -0.96%

Patria Private Equity Trust (PPET) 522.00p -0.95%