Rocketing Babcock pushes up FTSE 250

Market report

The smaller of London’s two biggest indexes managed to outperform its larger rival as shares in Babcock surged on Tuesday.

The FTSE 250 ended the day up 0.5% while the FTSE 100 was practically flat, ending up just 1.37 points to 6,890.49.

The difference between the two was in no small part because of Babcock. The defence contractor surprised investors with the announcement that it would slash around 1,000 jobs and wrote down £1.7 billion.

But investors rewarded the move with a 32% share priceincreasewhenmarketsclosedontuesday.the company unveiled a turnaround plan which included raising at least £400 million from selling assets.

But markets otherwise remained subdued in London. The FTSE 100’s finish compared unfavourably next to some of its European counterparts.

The Dax and Cac in Frankfurt and Paris rose 0.1% and 0.4% respectively.

Meanwhile, across the Atlantic, the Dow Jones was trading down 0.4% as markets closed in Europe, while the S&P 500 rose 0.1%.

“Contributing to the weak open from the US was the FDA’S warning that use of the Johnson & Johnson covid-19 vaccine needs to be paused, for similar reasons to the blood-clotting fears caused by the Astrazeneca/oxford jab,’’ said Spreadex analyst Connor Campbell.

News that the UK’S GDP grew despite lockdown was welcomed by analysts on Tuesday morning, as industrial and manufacturing production exceeded expectations.

Sterling was flat against the dollar, buying 1.3739, and dipped 0.2% buying 1.1513 euros.

The price of Brent crude oil rose 1% to 63.92 dollars per barrel.

Just Eat Takeaway.com led the FTSE 100 as it soared 6.8% after releasing sales data for the last three months. Order numbers soared by nearly four fifths to 200 million amid lockdown, the takeaway giant said.

It was joined in the green by JD Sports, which revealed that it expects its current financial year to be rosier than first thought. Shares rose 3% as it upgraded its profit outlook.

The positive news continued with Quiz. The dress-seller said that it expects more people to start buying its celebration wear, such as dresses, when they are able to celebrate again. Shares rose 8.3%.

Revolution Bars Group was also in the green despite falling to an £18 million pre-tax loss for the last half-year. Shares rose 5.3%.