Markets rise with eyes on Biden’s economic plans

LONDON’S top shares broke their three-day losing streak yesterday as traders across the globe readied themselves for the Joe Biden era in Washington.

Markets in Europe woke up in a good mood, and by 9.30am the FTSE 100 had settled near the level it would bow out at seven hours later. It ended on 6,801.96, a 56.44point or 0.8% rise.

Investors were waiting to see what measures the incoming Biden administration will set out ahead of taking the reins at the White House in less than a week.

“Though Donald Trump continues to eat up airtime... the incoming administration is ready to go on the fiscal offensive from day one,” said Spreadex analyst Conor Campbell.

He added: “Most relevant to the markets is size and scope of the relief plan the Democrats put together.

“It is likely Biden and co will return to the multitrillion-dollar package passed by the House of Representatives in the latter portion of last year – if not the full $2.2 trillion sum – as well as an additional commitment to a round of $1,400 stimulus cheques to complement the paltry $600 payments approved pre-Christmas.”

Hopeful investors sent the Cac index up by 0.35% in France, the Frankfurt index Dax by 0.33%, while in New York the S&P rose by 0.2%, and the Dow Jones by 0.4%.

On the currency markets, the pound now buys 1.368 dollars, up 0.3%, and 1.1262 euros, a 0.4% jump.

London’s rise was in no small part helped by Premier Inn owner Whitbread, which reported a huge drop in accommodation sales but said it had gained market share in a tough sector. Shares rose 4.3%.

The day’s other big news included Tesco, which saw its shares fall by 0.3% after reporting that the pandemic is likely to cost it £810 million this year, an upgrade of £85 million since the last estimate.

AB Foods, which owns Primark, said that more than three in four of its worldwide shops are closed, which could hit sales by £1.1 billion if in place until the end of February. Investors shrugged off the news, rewarding AB Foods with a 1.5% rise.

Halfords reported that bike sales were up more than a third in the last weeks of 2020, and its shares climbed 7.9%.

Centrica, which owns British Gas, did not lose customers over the last six months, it announced, sending shares up 3.3%.

Boohoo shares dropped 4.9% despite a 40% jump in revenues during a strong Black Friday and Christmas.

Taylor Wimpey rose 2.5% after revealing a 39% fall in home completions last year.

Shares in Card Factory dropped 7% after it warned it is going to breach its banking covenants by the end of January.

Dunelm fared even worse, despite a nearly 12% jump in sales during the final weeks of 2020. Shares fell 8.3%.

The biggest risers on the FTSE 100 were IAG, up 9.7p to 162.2p, Whitbread, up 132p to 3192p, BHP, up 80p to 2208p, Anglo American, up 87.5p to 2813p, and Johnson Matthey, up 86p to 2787p.

The big fallers were B&M, down 31.6p to 518.6p, Just Eat Takeaway.com, down 396p to 8280p, SSE, down 47.5p to 1529p, Pennon Group, down 27.8p to 952.4p, and Flutter Entertainment, down 325p to 14960p.