The FTSE 100 opened 0.6% higher on Thursday at 6,196, following gains in Asian markets which were boosted by positive news on development of a vaccine by US firm Pfizer (NYSE:PFE).
Travel related shares were strong following a government report that it will relax quarantine rules for around 75 countries, allowing Brits to go on holiday. British Airlines owner IAG (IAG) was 4% higher while Easyjet (EZY) shares were 5% ahead.
In Asia, China’s Shanghai Composite gained 2% and Japan’s Nikkei was 0.2% higher. Oil prices were 1.4% higher at $40 a barrel while Gold was flat at $1,769 per ounce. On the foreign exchange markets the pound was trading 0.2% high against the US dollar at $1.25.
CORPORATE NEWS
In a trading update Associated British Foods (ABF) said that it expected a sharp decline in Primark revenues after sales slipped 75% in the third quarter owing to store closures during the pandemic.
However the shares moved 7.4% higher to £21.10 on news that the company expected strong progress in full-year adjusted operating profit at its sugar, grocery, agriculture and ingredients businesses.
Packaging company DS Smith (SMDS) reported a 2% decline in revenue to £6.04 billion in its full-year results, which saw operating profit climb 6% to £455 million.
The company said that performance for the first 10 months of the financial year was robust with a relatively limited impact on operating profit of approximately £15 million in the final two months of the year from the COVID-19 pandemic.
However the firm said it was too early to restart dividends given the uncertainties. The shares dropped 9% to 290p.
Pub group Mitchells & Butlers (MAB) announced a pre-tax loss of £121 million for the half year on revenue of £1.04 billion as the lockdown took effect towards the end of the period and it prepares to re-open English sites.
The group said its German business, Alex, re-opened from mid to late May, and that it has been 'encouraged' that sales levels have grown each week since re-opening. The shares gained 0.8% to 193p.
Specialist in higher performance components and sub-systems for aerospace, defence and energy markets, Meggitt (MGGT) said it had seen a material impact on its operations in the second quarter with 60% of its fleet grounded in the civil aerospace division.
Overall it expects organic revenues to be 15% lower in the first-half, but in recent weeks it said it had seen signs of recovery in commercial aerospace, lifting the shares 4.9% to 320p.
Pure play music fund Hipgnosis Songs Fund (SONG) announced a £200 million equity raise by a placing of new C shares at 100p. The money will be used to continue its acquisition of music catalogues. The shares were flat at 116p.
Shares in Hungarian low cost carrier Wizz Air (WIZZ) flew 1% higher to £33.8 after it reported that its June passenger load factor fell to 52% from 95% a year ago, taking the rolling 12 month level to 92% from 93.2%. The company continues to grow its network with three new bases and 64 new routes.
Fresh produce company Total Produce (TOT:AIM) said trading for the six months to 30 June had been satisfactory with resilient sales, expected to be in line with the first-half of last year. The shares were flat at 101p.
