London open: Retail stocks help FTSE 100 jump 1.2% early on

22nd Apr 2024 08:25

(Sharecast News) - London's FTSE 100 surged in early deals on Monday, with just six stocks on the top-tier index trading in negative territory, as markets edged closer to their all-time highs ahead of a busy week.

The FTSE 100 was trading 1.2% higher at 7,988 by 0828, rising for the fourth straight day as it closes in on the 8,015.63 record closing high reached earlier this month. The index was faring better than the rest of Europe, where the pan-European Stoxx 600 index was up just 0.3%.

The Footsie's recent outperformance has come despite a turbulent time across global financial markets over the past week, with investors starting to question sky-high valuations in the tech sector following eye-watering gains for any companies in the AI space.

"Recent comments coming out of the semiconductor sector have raised some concerns that the current expectations for limitless growth may have been overdone," said Richard Hunter, head of markets at Interactive Investor.

"Given its lesser reliance on tech stocks, the FTSE100 powered ahead in early exchanges, in an echo of the market moves of 2022 when high growth shares were eschewed in favour of more stable, defensive and value stocks, all of which are to be found in abundance in the UK's premier index," Hunter said.

The economic data schedule looked relatively light on Monday, with eurozone consumer confidence and the Chicago Fed National Activity Index the only major releases of the session. However, things will pick up later in the week as US corporate earnings get into full swing, along with some important economic indicators.

Tuesday will also see a barrage of manufacturing surveys across Europe, the UK and US, followed by key US GDP and inflation figures on Thursday and Friday, respectively. Meanwhile, tech blue chips Tesla, Alphabet, Microsoft and Meta will report their latest quarterly figures in the coming days.

Hunter said that, given the "stretch valuations" in the tech sector following year-to-date gains, "any earnings misses or cautious guidance statements [are] likely to be punished".

Retailers gain, Tyman jumps

Retail stocks were performing well early after positive comments from RBC Capital Markets, which said that spending on travel, entertainment and clothing is likely to pick up. Marks & Spencer was among the biggest risers after RBC said the stock is its top pick in the sector "given it should be able to deliver moderate growth driven by structural improvements in food and womenswear".

Others in the sector, such as Ocado, Sainsbury, B&M, Tesco and Next were also putting in a decent performance.

Tyman shares jumped 27% after the company agreed to be bought by US metal window and door manufacturer Quanex in a £788m cash and stock deal. Nicky Hartery, non-executive chair of Tyman, said: "This transformative and complementary transaction will strengthen the enlarged business for the benefit of all our customers, employees and other stakeholders."

The saga at Hipgnosis Songs Fund took a new twist on Monday when private equity outfit Blackstone made a potential $1.5bn offer to buy the troubled music rights investor, setting up a bidding war with Concord Chorus. Shares were up 10% early on.

Market Movers

FTSE 100 (UKX) 7,988.08 1.17%

FTSE 250 (MCX) 19,532.54 0.73%

techMARK (TASX) 4,441.05 0.92%

FTSE 100 - Risers

Ocado Group (OCDO) 364.70p 5.04%

Marks & Spencer Group (MKS) 254.30p 3.46%

Sainsbury (J) (SBRY) 266.20p 2.86%

B&M European Value Retail S.A. (DI) (BME) 524.40p 2.74%

International Consolidated Airlines Group SA (CDI) (IAG) 173.60p 2.42%

BT Group (BT.A) 107.85p 2.32%

Legal & General Group (LGEN) 250.10p 2.25%

Next (NXT) 8,968.00p 2.21%

Diageo (DGE) 2,897.50p 2.15%

Tesco (TSCO) 287.40p 2.13%

FTSE 100 - Fallers

Fresnillo (FRES) 593.00p -1.50%

Anglo American (AAL) 2,160.50p -0.85%

Smith (DS) (SMDS) 357.40p -0.33%

Convatec Group (CTEC) 282.00p -0.21%

Mondi (MNDI) 1,502.00p -0.17%

Standard Chartered (STAN) 666.60p -0.03%

FTSE 250 - Risers

Tyman (TYMN) 377.00p 27.36%

Hipgnosis Songs Fund Limited NPV (SONG) 101.00p 9.90%

Dr. Martens (DOCS) 71.75p 6.61%

Foresight Group Holdings Limited NPV (FSG) 459.00p 4.32%

TUI AG Reg Shs (DI) (TUI) 595.50p 3.75%

Ferrexpo (FXPO) 49.00p 3.59%

Chemring Group (CHG) 353.50p 2.76%

Softcat (SCT) 1,591.00p 2.65%

AO World (AO.) 105.00p 2.54%

W.A.G Payment Solutions (WPS) 65.60p 2.50%

FTSE 250 - Fallers

Hochschild Mining (HOC) 147.80p -4.40%

Helios Towers (HTWS) 93.00p -3.63%

Auction Technology Group (ATG) 491.00p -2.77%

SThree (STEM) 431.00p -2.34%

Discoverie Group (DSCV) 675.00p -1.75%

RHI Magnesita N.V. (DI) (RHIM) 3,200.00p -1.69%

Mobico Group (MCG) 59.00p -1.67%

JPMorgan Emerging Markets Inv Trust (JMG) 100.00p -1.19%

Asia Dragon Trust (DGN) 349.00p -1.13%

Centamin (DI) (CEY) 126.10p -1.10%