Stocks in London ended higher on Tuesday, as the FTSE 100 was lifted by solid results from M&G and the intended launch of a share repurchase programme.
On the global front, US President Joe Biden announced a ban on US imports of Russian oil in his most far-reaching action yet to punish Moscow for invading Ukraine, while the UK also announced that it would phase out Russian oil imports by the end of this year.
Both announcements were made around the time of the London market close.
The FTSE 100 index closed marginally higher, up 4.63 points, or 0.1%, at 6,964.11.
The mid-cap FTSE 250 index closed up 47.84 points, or 0.3%, at 19,217.62. The AIM All-Share index closed up 3.69 points, or 0.4%, at 961.84.
The Cboe UK 100 index closed down 0.1% at 694.50. The Cboe 250 closed up 0.6% at 16,923.71, and the Cboe Small Companies finished up 1.5% at 14,142.67.
In mainland Europe, the CAC 40 in Paris ended up 0.3% and the DAX 40 in Frankfurt finished marginally lower.
Stocks in New York were lower at the London equities close. The DJIA was down 0.3%, the S&P 500 index down 0.6% and the Nasdaq Composite down 0.7%.
‘We're banning all imports of Russian oil and gas and energy. That means Russian oil will no longer be acceptable at US ports and the American people will deal another powerful blow to (President Vladimir) Putin,’ Biden said in an address from the White House, adding that the decision was taken ‘in close consultation’ with allies.
Brent oil was quoted at $132.65 a barrel at the equities close, up sharply from $123.22 at the close Monday.
Oil majors BP and Shell closed up 5.1% and 3.0% respectively, tracking spot oil prices higher.
In the FTSE 100, M&G ended the best performer, up 15%, after the investment manager announced a £500 million buyback and achieved cost savings a year ahead of schedule.
M&G ended 2021 with £370.0 billion in assets under management & administration, up 0.8% from £367.2 billion at the same point a year prior.
Turning to returns, M&G declared total dividends of 18.3 pence in 2021, up marginally from 18.2p in 2020. Further, the London-based firm plans to return £500 million to shareholders through a share buyback. This will start shortly.
In addition to meeting the £1.8 billion capital return aim, M&G also has delivered annual shareholder cost savings of £145 million. The cost saving target was delivered a year earlier than planned, it noted.
Fresnillo closed up 9.3% after the Mexican precious metal miner said it was able to produce silver just below guidance in 2021, but gold production was ahead.
That, together with higher prices, resulted in a rise in annual revenue. For 2021, pretax profit improved 11% to $611.5 million from $551.3 million, as revenue grew to $2.70 billion from $2.43 billion. Silver production was flat on the year before at 53,095 ounces, while gold production slipped 2.4% to 751,203 ounces.
Fresnillo declared total dividends for 2021 of 33.9 US cents, up 31% from 25.8 cents in 2020.
Gold stood at $2,056.80 an ounce at the London equities close, advancing from $1,978.34 late Monday. Midcap gold miners Petropavlovsk and Hochschild Mining ended the best performers, up 20% and 19% respectively.
In the FTSE 250, IWG closed up 9.7%. The office provider said it plans to merge some of its digital and technology assets with The Instant Group, before demerging the entity through a stock market listing by the end of next year.
Explaining the merger, Luxembourg-based IWG said it will invest £270 million to acquire the shares of selling shareholders and provide capital for growth, with The Instant Group management investing a further £50 million into the merger.
The Instant Group is a flexible workspace platform and services provider which operates in North America, Europe and Asia. By the end of 2023, the merged company will be spun out via a listing on US or UK markets.
Separately, IWG reported a narrowed loss in 2021 of £259.4 million, trimmed from 2020's loss of £613.3 million.
Conversely, Greggs lost 3.4% even as the bakery chain lifted its annual dividend, declared a special payout.
In the year that ended January 1, Greggs swung to a pretax profit of £145.6 million from a £13.7 million loss the year before. Revenue surged 52% to £1.23 billion from £811.3 million in 2020 and was up 5.3% from 2019's revenue of £1.17 billion, before the onset of the pandemic.
Like-for-like sales from company-managed stores were 3.3% below pre-virus levels. The measure does not include franchises.
Greggs declared a total dividend of 57.0p, after withholding its shareholder payout in 2020. In addition, it declared a 40.0p special payout, to be released in April.
Meanwhile, as a growing list of US multinational businesses, from Apple to Levi's, suspend activities in Russia, some companies have chosen to stay in the country despite the risks to their reputation.
But following last month's invasion of Ukraine, firms such as Pepsi and McDonald's face mounting pressure. Calls for repercussions for the recalcitrant are appearing on social media under hashtags such as #BoycottMcDonalds and #BoycottPepsi.
Late Monday, Yum Brands announced it ‘has suspended all investment and restaurant development in Russia’ and Estee Lauder ‘decided to suspend all commercial activity in Russia’. Starbucks and Coca-Cola have also been criticised on social media for failing to speak out about the attacks and continuing to operate in the country.
Sterling was in the red amid fears the ongoing conflict between Russia and Ukraine will deal a signifiant blow to the domestic economy.
The pound was quoted at $1.3110 at the London equities close, down from $1.3128 at the close Monday.
Even though the UK economy has little direct exposure to Russia and will be relatively insulated from sanctioning of Russian assets, rising commodity prices could filter though across Europe. As such, concerns have mounted that the price of many everyday items ranging from food to petrol and heating will rise and hurt consumers with inflation already at rampant levels.
The crisis in Ukraine has also turned up the heat on UK Chancellor of the Exchequer Rishi Sunak to reverse the planned national insurance hike in April, amid fears the domestic economy will plunge into ‘stagflation’.
Stagflation occurs when inflation rises while economic growth slows.
The euro was priced at $1.0890 at the European equities close, up from $1.0860. Against the yen, the dollar was trading at JP¥115.62, up from JP¥115.45.
The economic events calendar on Wednesday has China inflation figures overnight.
The UK corporate calendar on Wednesday has annual results from gambling firm 888 Holdings and from insurers Prudential and Legal & General Group.
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