UK stocks closed lower on Monday as investors took new localised Covid-19 restrictions outlined by prime minister Boris Johnson in their stride
The FTSE 100 index ended 15 points lower at 6,001 with gains in financial companies offsetting weakness in energy and consumer stocks.
As expected, Johnson announced a three-tier grading system - medium, high and very high - for restrictions that could force pubs, bars and gyms in some local areas to close.
US stocks surged on hopes that third quarter earnings may beat estimates, while sterling climbed to $1.308. Brent crude prices fell nearly 2% to $41.70 per barrel and gold prices eased to $1,922 per ounce.
LARGE-CAP MOVERS
Investment trust Scottish Mortgage (SMT) was the biggest FTSE 100 gainer, rising 3% to £10.56 after posting an 8% increase in net asset value including debt in the last month.
Pharmaceutical company AstraZeneca (AZN) added 0.5% to £84.70 after it secured $486 million from the US government to develop an antibody treatment for Covid-19.
AstraZeneca said it would initiate two related phase-three clinical trials, expected to kick off in the coming weeks.
Sports-betting and gaming group GVC (GVC) said it had been awarded four sports-betting licences in Germany.
The terms of the licence included a wagering limit of €1,000 per month that can be increased to €10,000 subject to certain criteria being met, or further to €30,000 for 1% of customers, subject to enhanced due diligence and certain loss limits.
The terms also included deposit limits, in-force until customer verification processes were complete, a maximum annual bonus per customer of €100 and the inclusion of certain responsibility requirements by the licence holder. Shares fell 2.3% to £10.65.
International Airlines Group descended 1.7% to 102p on the news that Alex Cruz would stand down as chief executive of British Airways.
Cruz will be replaced by Aer Lingus chairman and chief executive Sean Doyle, though he will remain as British Airways non-executive chairman.
In a dramatic reversal, aero engine maker Rolls-Royce (RR.) went from being the best performer in the benchmark, climbing 5.2% to 235p, to the biggest loser falling 12.5% to 195p.
MID- AND SMALL-CAP MOVERS
Shares in immunotherapies developer Scancell (SCLP) leapt 8.5% to 17.4p, even as it raised £30 million from funds managed by US specialist healthcare investor Redmile at a price of 13p. Scancell said it was also planning to raise around £3 million from an open offer of shares at the same price.
Cake retailer Cake Box (CBOX) rose 5.5% to 174p, despite having reported a fall in first-half revenue owing to the impact of store closures, as it reassured pre-pandemic momentum had resumed as Covid-19 restrictions eased.
For the 20 weeks to 30 September, like-for-like sales jumped around 12%, the company said.
In a third-quarter trading update, logistics warehouse company Tritax Big Box Reit (BBOX) said the UK continued to strengthen. The company added it sees ‘potential for further yield compression in the near-term given attractive structural trends and the secure, long-term income offered by large-scale modern logistics buildings.’
The company also declared a dividend to 30 September 2020 of 1.5625 pence per ordinary share, payable on or around 13 November 2020 to shareholders on the register on 23 October 2020. Shares added 2% to 165p.
Power control component supplier XP Power (XPP) rallied 0.6% to £47.30, having guided for an annual performance towards the top end of current analyst expectations after its third-quarter revenue jumped 28%.
On what was a big day for executive appointments, XP Power also announced that chief executive Duncan Penny would retire at the end of 2020 to be replaced by chief financial officer Gavin Griggs.
Real Estate company Great Portland Estates (GPOR) reported it had collected 61% of rent of the September quarter and said that while rental collection and occupancy rates had improved since March, many sectors remained challenged.
For the quarter to 30 September 2020, 61% of rents due was secured within seven working days, up from 57% seen in the June quarter. To date, September quarterly recent collection had risen to 63%, the company said. For September, the company had collected 73% of rent to date. Shares nudged up 0.5% to 646p.
Oil services group Petrofac (PFC) ticked down 2% to 114p following news that chief executive Ayman Asfari would retire at the end of the year, to focus on his family, health and charitable interests.
He would be replaced by Sami Iskander, executive vice president for Shell's upstream joint ventures business between 2016 and 2019.
Engineering and industrial software group Aveva (AVV) reversed 2.6% to £46.15 after it forecast a drop in first half revenue to £333 million, citing FX headwinds and two subscription deals which slipped into the third quarter. Last year Aveva reported first-half revenue of £391.9 million.
Shares in Middle East and Africa focused payments firm Network International (NETW) fell 3.9% to 305p after guiding for a 17% drop in annual revenue, which it said was at the top end of its guidance range.
Revenue in the third quarter also had fallen 17%, which Network International said marked an improvement from the 23% decline experienced in the second quarter.
Bus and rail company National Express (NEX) fell 4.4% to 167p on announcing it had appointed Ignacio Garat as chief executive to replace current interim CEO Chris Davies.
Garat was most recently senior vice president Southern Europe, France and Benelux operations for FedEx.
Shares in AIM-listed foreign exchange provider Argentex (AGFX:AIM) tumbled 20% to 109.5p after it forecast close to a 15% drop in first half revenues due to subdued trading activity by its customers.
Despite the firm holding out hope of a second half rebound, broker Numis cut its full year revenue forecast by 13% and slashed its earnings forecast by more than 30%.
