Major UK shares enjoyed a strong start on day one of 2022 trading as investors anticipate a brighter outlook for the global economy in the New Year as fears of the Omicron variant fade.
At the close, the UK benchmark FTSE 100 rose more than 1.6% to finish above the 7,5000 mark at 7,505.15, with a reopening trade firmly in effect. BA-owner International Consolidated Airlines’ (IAG) led the FTSE 100 leader board with a 12% jump to 159.64p while there were widespread gains for oil companies, travel stocks, hotels, pub and restaurant plays, reflecting fading worries of tighter restrictions in the future.
Energy giants BP (BP.) and Royal Dutch Shell (RDSB) were in demand, as was Premier Inn parent Whitbread (WTB).
Among second-liners, consumer-facing names including holidays company TUI (TUI), cruise operator Carnival (CCL) and low-cost carrier EasyJet (EZJ) caught a bid.
US indices were mixed in early Tuesday trading. The Dow Jones rose 0.5% at 36,636 while the S&P 500 was 0.3% down at 4,758, while the tech-laced Nasdaq Composite losing 1.8% at 15,530.
CORPORATE NEWS
Shares in Rolls-Royce (RR.) were also boosted by the news it has completed the sale of its Bergen Engines business to Langley Holdings for an enterprise value of €63 million.
Rolls-Royce said sale proceeds of €91 million, together with €16 million of cash held within Bergen Engines which has been retained, will be used to help rebuild the balance sheet.
The shares rose 3% to 127.08p.
In the FTSE 250, Capita (CPI) was marked up more than 5% to 38.34p after the support services provider completed the sale of its secure solutions and services business to NEC Software Solutions UK for £62 million.
Budget carrier Wizz Air (WIZZ) rallied 12% to £47 on news that passenger numbers increased in December amid an ongoing recovery in the travel sector.
Passenger numbers in December rose 296.3% to about 2.6 million from a year earlier and the low-cost airline’s load factor rose 19.3% percentage points to 75.4%.
Building materials distributor Grafton (GFTU) gained 1.7% to £12.55 as it flagged the completion of the sale of its traditional merchanting business in the UK on New Year’s Eve.
AROUND THE MARKET
Elsewhere, SigmaRoc (SRC:AIM) skipped 5.2% higher to 87.8p after the quarried material company announced the acquisition of profitable Johnston Quarry for an initial £35.5 million in cash.
SigmaRoc CEO Max Vermorken said Johnston Quarry is ‘a high quality quarrying group, with an attractive geographic footprint and a product range which offers both architectural and environmental benefits over alternatives. The acquisition extends our footprint significantly in several key markets within the UK, while offering the opportunity for further improvement and platform based synergies.’
Restaurants owner and operator Tasty (TAST:AIM) ticked up 2.4% to 5.25p despite reporting a considerably weaker than anticipated performance in December as pandemic-related government restrictions reduced customers eating out and deterred larger Christmas bookings.
However, investors were relieved as the casual dining sector player confirmed that its restaurants have so far remained open with only isolated Covid-19 related disruptions to date.
2022 ‘will not be without its challenges’ conceded Tasty, as the company prepares for the end of government support, though it is ‘confident in its brands and optimistic about the trading potential of the group, especially with the strong revenue stream provided by takeaway and delivery services’.
Biotherapeutics company 4D Pharma (DDDD:AIM) dipped 2.8% to 52.1p despite appointing John Doyle as finance director. Doyle joins 4D pharma after serving as finance director at Chiasma, a publicly traded biopharmaceutical company acquired by Amryt Pharma in 2021.
And geospatial productivity and collaboration software company IQGeo (IQG:AIM) climbed 1.6% to 131p after winning a five-year contract from an unnamed US telecom network operator.
