London stocks end the week lower despite strong economic data
London’s blue-chip stocks were little changed on Friday but finished the week lower as growing concerns over a surge in global coronavirus cases eclipsed optimism from recent data pointing to a rapid UK economic rebound.
The exporter-heavy index ended the session flat, with a fall in heavyweight energy shares and large dollar earning companies including Diageo, AstraZeneca and Reckitt Benckiser Group weighing on the index.
Sectors tied to economic outlook, including miners and banks and travel and leisure outperformed during the session.
The FTSE 100 has gained 7.4 per cent so far this year on optimism that speedy Covid-19 vaccinations and constant policy support from the government would drive a stronger economic recovery.
However, it is set for its biggest weekly decline since the end of February as a recent spike in cases in parts of Asia has stoked fears of delayed global economic recovery.
The domestically focussed mid-cap FTSE 250 index posted its first weekly drop in five.
In the US, tock indexes jumped as a rise in factory activity in April supported bets of swifter economic recovery, while a fall in shares of American Express and Honeywell kept gains on the blue-chip Dow in check.
Data firm IHS Markit said its flash U.S. manufacturing PMI increased to 60.6 in the first half of this month, the highest reading since the series started in May 2007.
All the 11 major S&P 500 sectors were higher by early afternoon trading, with technology and financials leading gains.
The Dow Jones Industrial Average was up 169.41 points, or 0.50 per cent, at 33,985.31, the S&P 500 was up 41.22 points, or 1.00 per cent, at 4,176.20 and the Nasdaq Composite was up 187.59 points, or 1.36 per cent, at 14,006.01.
Wall Street’s main indexes had slid nearly nearly 1 per cent in the previous session following reports of U.S. President Joe Biden’s plans to raise taxes on the wealthiest Americans, including the largest-ever increase in levies on investment gains.
Market movers
The morning’s biggest winner was industrial software firm Aveva, who rose 4.7 per cent, followed by Rolls-Royce, up by 3.2 per cent.
Property giant Rightmove and Ocado also rose 3.2 per cent and 2.9 per cent respectively.
Aerospace firm BAE Systems was the morning’s biggest faller, dropping by 4.1 per cent, followed by miner Fresnillo’s 2.6 per cent hit.
Meanwhile, Antofagasta and Standard Life Aberdeen both dipped by two per cent and 1.5 per cent respectively.
Around the world
Elsewhere, Asian shares shot up on Friday, lifted by rising Chinese blue-chips and a decision by the European Central Bank to maintain stimulus.
Asian investors largely shrugged off the impact of a possible US capital gains tax hike.
European equity markets opened higher to add to two days of gains, with the Euro Stoxx 50 futures up by almost one per cent.
Meanwhile, the Dow Jones Industrial Average ended down 0.94 per cent and Japan’s Nikkei slipped 0.6 per cent.