• FTSE 100 rises 14 points
  • UK and US economies pick up
  • Wall Street mixed at midday

London’s leading index closed 14 points, 0.2%, higher on Wednesday, and the FTSE 250 improved 71 points, 0.3%, to 21,403.

“London’s FTSE 100 is outperforming the DAX 30 as the upward move in natural resource stocks is giving the British market an edge,” CMC Markets UK analyst David Madden wrote. “The bullish moves in oil and copper have lifted BP, Royal Dutch Shell, Rio Tinto, Glencore and Anglo American.”  

DIY group Kingfisher PLC (LON.KGF) was among the day’s leaders, adding more than 3% to £325.

In the US, the Dow was up 282 points, 0.9%, at 32,705 in early afternoon trading, and the S&P 500 added 17 points, 0.5%, to 3,928. The Nasdaq Composite, meanwhile, slipped 82 points, 0.6%, to 13,145.

After reporting earnings Tuesday after the close, shares of GameStop Corp (NYSE:GME) are down more than 18% to $148.15,

“GameStop shares are in the red as the company said it is contemplating selling off some of its stock as a way to finance its restructuring,” Madden wrote. “Despite the fact the stock has dropped greatly since its recent all-time high, it is still up over 800% on a year-to-date basis. The company needs to pivot away from its bricks and mortar business and put more focus on its online sales, in the fourth quarter, ecommerce sales rose by 175%, which accounted for more than one third of total sales.

“GameStop has been left behind by the switch to online sales and those problems were compounded by the lockdowns. Should the company dispose of some of its shares and use the funds to reinvest in the business that should benefit the firm in the long run.”

4.08pm: Kingfisher leads the way

Leading UK shares are doing their best but are finding it a bit of a struggle, with worries about a European third wave of the pandemic vying with postive signs from the UK and US economies.

The FTSE 100 is holding on to its gains, but they are not exactly impressive, with the blue chip index up 14.88 points or 0.22% at 6714.07.

DIY group Kingfisher PLC (LON.KGF) is the best of the bunch, up 10.2p or 3.24% at 325.2p in the wake of this week’s results and news that Travis Perkins (LON.TPK), up 0.88% or 14p to 1599p, is positive enough about the home improvement market to list its Wickes chain on the stock exchange.

Over in the US, markets are brighter after some positive data and the latest comments from Federal Reserve chair Jerome Powell and Treasury Secretary Janet Yellen.

The Dow Jones Industrial Average is up 310 points or 0.96% and the S&P 500 is 0.56% better. The tech-heavy Nasdaq Composite is still flagging however, down 0.47%.

Edward Moya at Oanda said: “US stocks rallied after Fed Chair Powell and Treasury Secretary Yellen reinforced their bright outlook for the economy and stance on inflation, government debt, need for revenue for permanent spending, and ultra-dovish commitment for the labor market… financial markets will now focus on the bond market to see how high Treasury yields can go before they threaten financial conditions.

“For now, rising tensions between the US and China are viewed mostly as posturing. The S&P 500 index pared gains after Secretary of State Blinken stated that Beijing’s coercive behavior threatens NATO’s collective security and prosperity.  Eventually, the growing spat between the world’s two largest economies will weigh on risk appetite, but right now it feels like we are only in the first inning.” 

2.47pm: Proactive North America headlines:

Cloud Nine Web3 Technologies  Inc (CSE:CNI) (OTCMKTS:CLGUF) names entrepreneur and CEO of Victory Square Technologies as strategic advisor

Clean Seed Capital Group Ltd (CVE:CSX) (OTCMKTS:CLGPF)to break ground on new operations and assembly facility in Saskatchewan

Plurilock Security Inc (CVE:PLUR) (OTCQB:PLCKF) completes transitioning to its new state-of-the-art cloud infrastructure

Australis Capital Inc (CSE:AUSA) (OTC:AUSAF) (FRA:AC4) completes first phase of Green Therapeutics acquisition with cannabis subsidiary purchase

American Battery Metals Corporation (OTCQB:ABML) achieves notable milestones in the development of its lithium-ion battery recycling pilot plant in Nevada

Dalrada Financial Corp (OTCQB:DFCO) appoints new executive vice president of sales and business development

The Parent Company Holding Corp (NEO:GRAM.U) (OTCQX:GRAMF) (OTCPINK:GRMWF) launches Fun Uncle Cruises full gram vape cartridges

PlantX Life Inc (CSE:VEGA) (OTCQB:PLXTF) (FRA:WNT1) teams up with celebrity chef Anne Thornton on new plant-based meal initiative

Revive Therapeutics Ltd (CSE:RVV) (OTCMKTS:RVVTF) (FRA:31R) on track to meet planned patient enrollment for its Phase 3 Bucillamine coronavirus trial in second quarter

Power REIT (NYSEAMERICAN:PW) 4Q revenue surges 121% to $1.4M as accretive acquisitions pay off

ImagineAR Inc (CSE:IP) (OTCQB:IPNFF) (FRA:GMS1)  says May Pang offering her personal collection of John Lennon’s ‘Lost Weekend’ photographs to NFT collector market

Lexaria technology Corp (NASDAQ:LEXX) (CSE:LXX) generates positive stability testing for ready-to-drink CBD beverages

Willow Biosciences Inc (TSE:WLLW) (OTCQX:CANSF) on track to commercialize ultra-pure cannabinoids in 2021 with over C$47M in the bank

Roth Capital Partners boosts target price for Energy Fuels to $6.50 from $2.50, repeats ‘Buy’ following the company’s recent 2020 results

Bragg Gaming Group Inc (TSX:BRAG) (OTCMKTS:BRGGF) (FRA:SL4A) appoints Richard Carter as new CEO

Empower Clinics Inc (CSE:CBDT) (FRA:8EC) (OTCQB:EPWCF) submits bids to provide coronavirus tests for 50,000 federal employees through KAI Medical Laboratory

WeedMD Inc (CVE:WMD) (OTCQX:WDDMF) (FRA:4WE) offers “unique medical cannabis strategy”, says broker Canaccord, which kicks off coverage

Airnow Data points to continued strength of apps amid US March Madness basketball tournament

2.46pm: US business activity impresses

More signs of a strong US economy have come in the latest IHS Markit business activity report.

The service sector was the driving force this month, with the initial reading of the services business activity index up from 59.8 in February to 60.0. The manufacturing PMI edged up from 58.6 to 59, giving a composite index reading for both sectors of 59.1. This was marginally lower than the February figure of 59.5 but still shows a very positive performance and is the second fastest private sector upturn for six years.

Chris Williamson, chief business economist at IHS Markit, said: “Another impressive expansion of business activity in March ended the economy’s strongest quarter since 2014. The vaccine roll-out, the reopening of the economy and an additional $1.9 trillion of stimulus all helped lift demand to an extent not seen for over six years, buoying growth of orders for both goods and services to multi-year highs.

“Producers were increasingly unable to keep pace with demand, however, due mainly to supply chain disruptions and delays. Higher prices have ensued, with rates of both input cost and selling price inflation running far above anything previously seen in the survey’s history.”

The news has helped push the Dow Jones Industrial Average 0.78% or 253.68 points higher to 32,676.83. The S&P 500 is 0.34% better but the tech-heavy Nasdaq Composite is down 0.4%.

All this has done little to enthuse the FTSE 100 which is virtually unchanged at 6701.15, up just 1.96 points.

1.43pm: Wall Street rises at the opening bell

As expected, the main indices on Wall Street were firmly in the green on Wednesday morning as traders looked to recover Tuesday’s losses.

Shortly after the opening bell, the Dow Jones Industrial Average was up 0.47% at 32,576 while the S&P 500 climbed 0.44% to 3,927 and the Nasdaq rose 0.36% to 13,274.

Equities seem to have been lifted by a fall in bond yields as well as rising oil prices caused partially by the ongoing blockage of the Suez canal by a grounded container ship.

Meanwhile, Reddit darling GameStop Corp (NYSE:GME) got off the a bleak start following its results overnight, with the shares down 9.6% at US$164.30 in early deals.

Back in London, the strong start in the US appeared to have lifted the FTSE 100, which had eked out a gain of 3 points to 6,702 just before 1.45pm.

12.56pm: US durable goods show surprise fall

Halma PLC (LON.HMLA) is one of the companies bucking the downward drift of the UK blue chip index.

The safety, health and environmental technology group has raised its profit forecasts after an improvement in business in the second half of the year. 

It said full year pretax profit was now expected to be in line with the previous year’s £267mln compared to an earlier forecast of a 5% drop.

In a buy note analyst Akhil Patel at Shore Capital said: “In our view, Halma is a high-quality business with long-term growth drivers (increasing: health and safety regulation, demand for healthcare services in developing economies and demand for life-critical resources) and strong operating margins.”

The shares have added 44p or 1.91% to 2349p.

Back in the US and orders for durable goods – long-lasting items such as washing machines and the like – unexpectedly fell by 1.1% in February, compared to expectations of a 0.8% increase.

Adam Button at ForexLive said: “This is a soft report and the first big miss in a while but the market reaction has been minimal. This is the first decline since last April so the market is likely to forgive it, especially in the Markit manufacturing survey at 13.45 GMT is strong.”

Indeed US market futures are virtually unchanged from before this latest data.

As for the FTSE 100, it is still pretty much marking time, down 16.61 points or 0.25%.

 

11.50am: Fed testimony due again

Wall Street is expected to open higher after US Treasury yields dipped again in the wake of comments from Federal Reserve chair Jerome Powell and ahead of another testimony from him later. There is also support from the rising oil price after the container ship blocked the Suez canal.

The Dow Jones Industrial Average is forecast to rise 138 points to 32,561, the S&P 500 is expected to open 15 points higher at 3925 and the Nasdaq Composite futures are showing a 100 point gain to 13,327.

Jim Reid at Deutsche Bank said: “Treasury Secretary Yellen and Fed Chair Powell appeared before the House of Representatives Financial Services Committee (on Tuesday) as part of the Congressional oversight of the pandemic response. Both officials are expected to appear before the Senate Banking Committee later on today in what is likely to be an encore performance. Chair Powell spoke to inflation worries saying that he and his colleagues do believe there will be upward pressure on prices , but “that the effect on inflation will be neither particularly large nor persistent.” He went on to cite that “we have been living in a world of strong disinflationary pressures – around the world really – for a quarter of a century…We don’t think a one-time surge in spending leading to temporary price increases would disrupt that.”

Bitcoin is in demand again after, what else, a tweet from Elon Musk.

Sophie Griffiths, market analyst at Oanda said: “Both Bitcoin and Tesla are likely to be in focus. The crypto currency has surged 5% after Tesla CEO announced that Tesla now accepts Bitcoin. Whilst details such as pricing policy are short on the ground, the announcement is still music to the ears of Bitcoin bulls.”

GameStop shares are around 13% lower in pre-market trading after its sales and income both fell short of forecasts, while US durable goods figures are due at 12.30pm GMT.

Back in the UK the FTSE just cannot pick up steam, down 9.69 points or 0.14% at 6689.5.

10.42am: Market’s third wave concerns continue

Oil prices are heading higher after the Suez canal was blocked by a huge container ship which ran aground, causing a jam of vessels at either end of the trade route.

Brent crude has added 2.48% to $62.3 a barrel, helping support BP PLC (LON.BP) after the oil giant was downgraded from A1 to A2 by ratings agency Moody’s. But Sven Reinke, a Moody’ s senior vice president, added: “We believe that BP’s financial profile will recover from the 2020 downturn over the next 12-18 months supported by improving market conditions and BP’s measures to protect its cash flow generation and balance sheet initiated in 2020, thereby positioning it solidly in the A2 rating.” 

BP is up 0.96% or 2.85p at 298.6p.

Elsewhere British Airways owner International Consolidated AirlinesGroup (LON.IAG) has recovered from early falls, now up 7.2p or 3.84% at 194.55p, as has Rolls-Royce Holdings PLC LON.RR), 3.2p or 3.04% better at 108.5p.

But Just Eat Takeaway.com NV (LON.JET) is down 1.72% or 118p at 6744p after this week’s confirmation from rival Deliveroo that it would float early next month.

Overall the FTSE 100 still lacks inspiration, down 13.70 points or 0.2% at 6685.49.

David Madden, market analyst at CMC Markets UK, said: “Once again, concerns about another wave of COVID-19 cases in Europe and worries that economies will reopen later than initially predicted are weighing on stocks. In the grand scheme of things, the declines in stocks are relatively small because even though some countries might need to maintain tight restrictions for a little longer than initially hoped, there is a belief that countries will fully reopen at some point.”

10.22am: Better than expected UK growth

Signs of life in the UK economy as it showed a sharp rebound in March after two months of decline.

The composite purchasing managers index, which included both service and manufacturing sectors, came in at a much better than expected 56.6 at according to the latest IHS Markit/CIPS survey.

 

Chris Williamson, chief business economist at IHS Markit, said: “The UK economy rebounded from two months of decline in March, with business activity growing at its fastest rate since last August as children returned to schools, businesses prepared for the reopening of the economy and the vaccine roll-out boosted confidence.

“Companies reported an influx of new orders on a scale exceeded only once in almost four years, and business expectations for growth in the year ahead surged to the highest since comparable data were first available in 2012. Employment consequently rose for the first time since the pandemic struck as firms expanded capacity in response to the new inflows of work and brighter outlook.

“Worries persist though, especially in relation to near-record supply chain delays, a continued fall in exports and sharply rising prices, all of which are making life difficult for many companies. Many consumer facing companies meanwhile remain constrained by COVID-19 restrictions, which are likely to curb the overall pace of economic growth for some time to come, especially if we see a third wave of infections.”

 

Dean Turner, economist at UBS Global Wealth Management, said: “The notable take from this morning’s PMI figures is the surge in services, overtaking the manufacturing index for the first time since the start of the pandemic. Nevertheless, the manufacturing sector continues to perform well although export sales are still struggling, probably a reflection of the ongoing Brexit adjustment, alongside the well telegraphed problems with supply chains globally.”

“It is also clear from the survey that the prospect of easing restrictions buoyed sentiment, as new work increased, and businesses reported rising forward bookings from domestic consumers.

“Today’s numbers are consistent with our view that brighter days are ahead for the economy.”

On the supply chain delays, Sarah Banks, managing director of Freight and Logistics at Accenture Global, said: “While the forecast uptick in demand for manufactured goods is encouraging, it has brought with it an array of additional problems. With demand for inputs not yet being met by supply, shipping delays and shortages of materials are being widely reported, and have led to near-record supply chain delays.”

The positive news on the economy has done little to boost the market however. The FTSE 100 remains in the doldrums, down 9.64 points or 0.14% at 6689.55.

9.12am: UK prices rise less than expected

Markets have been rattled recently by concerns about rising inflation. But this morning’s UK figures have come in lower than expected.

Inflation rose by 0.4% in February, compared to 0.7% the previous month and a forecast increase of 0.8%. Even so, there are signs that inflationary pressures may be building.

Danni Hewson, financial analyst at AJ Bell, said: “Looking at today’s figures you’d be forgiven for wondering why there has been such concern about rising inflation.  Lockdown three has dented seasonal clothing sales at a time we traditionally see prices rise. The cost of toys and computer games have fallen as have second-hand cars and public transport.

“But these falls must be put into context. Shops are still shut, children had yet to return to school and many workers continue to do their jobs from home. It’s impossible to compare with what’s normally expected. The economy has been distorted and many of the measures the ONS usually looks at have been missing.

“Trying to quantify what will happen when lockdown ends is rather like trying to read tea leaves. But February’s figures do raise some red flags and suggest inflationary pressures may be brewing.  Creeping commodity prices are beginning to be felt by the consumer.  Motor fuels saw a 0.11% hike and housing costs like water and electricity were up 0.1%.”

Overall, investors are more concerned with the prospect of a third European COVID-19 wave continuing to hit travel and tourism shares although the the FTSE 100 is off its worst levels, down just 7.51 points or 0.11% at 6690.63.

Shortly (at 9.30am GMT) come the initial snapshots of UK manufacturing and services for March.

8.40am FTSE heads lower

The FTSE 100 reflected a fairly gloomy outlook for the travel and tourism sector sparked by the European third COVID-19 wave.

Rolls Royce (LON:RR.), which supplies jet engines to the world’s airlines and is often paid per mile they fly, led the losers’ list early on with a 4.3% fall.

It encountered further turbulence after the Norwegian government blocked it from selling a maritime engine business to a Russian company.

Down in Rolls’ slipstream was Melrose Industries (LON:MRO), owner of the aerospace group GKN. Its shares limped 2.1% lower.

British Airways owner IAG (LON:IAG) was left on the apron with a 2.2% fall.

A bright light on a dull day in the Square Mile was software firm Softcat (LON:SCT), which said its full-year results will be significantly ahead of City forecasts. Its stock jumped 11%.

Proactive news headlines

Keywords Studios PLC (LON:KWS) saw its profits jump in 2020 as a boom in the video game market during the coronavirus (COVID-19) pandemic drove demand for its development services.

Bloomsbury Publishing PLC (LON:BMY) upgraded its profits expectations for a second time after an unexpected surge in demand for books in February.

DeepVerge (LON:DVRG) said it has inked a technical and commercial agreement that will see it use its Covid screening technology in miniaturised mass spectrometry equipment developed by Microsaic Systems PLC (LONMSYS).

Arix Bioscience PLC (LON:ARIX) said it has begun a strategy implementation review that will assess board composition, executive resourcing and remuneration.

Frontier IP Group PLC (LON:FIPP) reported a strong increase in first-half profits as the value of the intellectual property commercialisation firm’s portfolio grew 21% to £23.4mln. 

Guild Esports PLC (LON:GILD) said it has signed Jannis Matwin, also known as JannisZ, as the fifth member of its pro Fortnite esports team.

Feedback PLC (LON:FDBK) said it has landed a one-year deal worth £84,000 with the Royal Berkshire NHS Foundation Trust for its clinical communications platform, Bleepa.

Oriole Resources PLC (LON:ORR) is extremely well placed for 2021 with active drilling campaigns at its core projects in Cameroon and Senegal as well as at its investment projects in Djibouti and Turkey, the exploration company said alongside its full-year results for 2020.

Bahamas Petroleum Company PLC (LON:BP.) has reaffirmed it commitment to high impact offshore exploration in the Caribbean, stating its intention to extend its licences and seek partners ahead of new well drilling.

Applied Graphene Materials PLC (LON:AGM) said it is looking forward to stronger sales growth and it has enough cash to fund operations well into 2023 after a £5.5mln fundraise in January.

ADM Energy PLC (LON:ADME) confirmed it has now closed its oversubscribed fundraising to support its new venture in Nigeria, an interest in the development of the Barracuda field.

Vanadium producer Ferro Alloy Resources Ltd (LON:FAR) said chief executive Nick Bridgen sold 16.67mln shares in the company, via a placing priced at 30p per share, raising gross proceeds of about £5mln. 

Tally, the gold-backed banking platform, will hold a live shareholder Q&A with CEO and founder Cameron Parry on the online Tally Community today from 6pm-7pm.

Emmerson PLC (LON:EML) announced that further to its announcement regarding the appointment of James Kelly to the board, the company has allotted him 600,000 new ordinary shares at a price of 5.65p each. 

6.50 am: Third-wave fears to grip market

The FTSE 100 is expected to open in the red on Wednesday as uncertainty began to increase around the speed of an economic rebound from the coronavirus (COVID-19) pandemic.

Spread-better IG expects the blue-chip index to open down around 43 points on Wednesday morning after ending Tuesday’s session 27 points lower at 6,699.

Hopes for a swift economic recovery appear to have been shaken by rising infection rates in continental Europe, suggesting that even if the UK and the US manage to get their own outbreaks of COVID-19 under control it is unlikely that international travel will be able to resume completely, which will, in turn, weigh on travel and leisure stocks.

Threats by the European Union to export vaccines produced in the bloc to other areas of the world is also unlikely to help matters.

Market sentiment was similarly bleak in Wall Street overnight, with the Dow Jones Industrial Average closing 0.94% lower at 32,423 while the S&P 500 dropped 0.76% to 3,910 and the Nasdaq fell 1.12% to 13,227.

Things were much the same in Asia this morning with Japan’s Nikkei 225 down 2.04% while Hong Kong’s Hang Seng fell 2.24%.

On currency markets, the pound was trading 0.3% lower against the dollar at US$1.371 early on Wednesday, however, there could be some movement catalysts from UK inflation data and as well as UK and US flash PMI readings due alter today.

Around the markets:

Sterling: US$1.371, down 0.3%

Brent crude: US$61 a barrel, up 0.35%

Gold: US$1,730.35 an ounce, down 0.47%

Bitcoin: US$53,834, up 1.3%

6.50am: Early Markets – Asia / Australia

Stocks in the Asia-Pacific region were lower on Wednesday as concerns over the global economy’s recovery from the pandemic weighed on investor sentiment.

The Hang Seng index in Hong Kong fell 2.15% while the Shanghai Composite in China dipped 1.36%.

In Japan, the Nikkei 225 slipped 2.04% and South Korea’s Kospi declined 0.28%.

Shares in Australia were an exception, with the S&P/ASX 200 closing 0.50% higher.

READ OUR ASX REPORT HERE

Proactive Australia news:

Kingwest Resources Ltd (ASX:KWR) has delivered a positive scoping study for the Menzies Gold Project (MGP) in Western Australia based on open pit mining and third-party toll treatment of resources.

Alta Zinc Ltd (ASX:AZI) (FRA:8EE) has raised $3.75 million in a strongly supported placement after receiving binding commitments from eligible professional and sophisticated investors, with funds to further advance drilling at the Gorno Zinc Project in northern Italy.

PNX Metals Ltd (ASX:PNX) has received the green light from the Northern Territory Department of Industry, Tourism and Trade (DITT) to vary its Mine Management Plan (MMP) to allow dewatering of the pit at Fountain Head Gold Project.

Silver Mines Limited (ASX:SVL) (OTCMKTS:SLVMF) (FRA:SWQ) has submitted its Mining Lease Application (MLA 601) for the development of the Bowdens Silver Project, the largest undeveloped silver deposit in Australia.

Emmerson Resources Ltd (ASX:ERM) (FRA:42E) has raised $2 million with Tennant Consolidated Mining Group (TCMG) in a placement enabling the strategic alliance over the Northern Project Area (NPA) of Tennant Creeek Project in the Northern Territory to advance towards gold production.

archTIS Ltd (ASX:AR9) continues to grow its customer base having secured several key new customers wins along with some renewals and expansion of existing customer licences.

Pan Asia Metals Ltd (ASX:PAM) has intersected pegmatite dyke swarms over substantial widths in all six diamond drill holes completed at Bang I Tum (BIT) prospect within the wider Reung Kiet Lithium Project (RKLP) in southern Thailand.

Vango Mining Ltd‘s (ASX:VAN) high-grade results from a 20,000-metre drilling campaign at its Marymia Gold Project in Western Australia’s Mid-West have extended the gold mineralised system along strike and depth at three major gold corridors – Trident, PHB and Triple-P.

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