An indication that China is finally winning its battle against Covid-19 gave stock markets a lift on Thursday, while private equity investor 3i led the FTSE 100 after reporting a strong rise in net asset value.
The London large-cap index opened up 19.81 points, 0.3%, at 7,764.68. The FTSE 250 was up 124.66 points, 0.6%, at 19,928.70, and the AIM All-Share was up 4.07 points, 0.5%, at 864.85.
The Cboe UK 100 was up 0.3% at 776.78, the Cboe UK 250 up 0.6% at 17,370.86, and the Cboe Small Companies up 0.2% at 14,105.92.
In European equities on Thursday, the CAC 40 in Paris was up 0.5%, while the DAX 40 in Frankfurt was up 0.3%.
The pound was quoted at $1.2415 early on Thursday in London, up compared to $1.2354 at the equities close on Wednesday. The euro stood at $1.0916, up against $1.0886. Against the yen, the dollar was trading at JP¥129.67, slightly lower compared to JP¥129.78.
In the FTSE 100, the best performer in early trade was 3i Group, adding 4.7%.
The London-based venture capital firm said its NAV per share increased to 1,649 pence at the end of its financial third quarter ended December 31, up from 1,477p on September 30.
3i added that in the 12 months to January, investee Action’s net sales and earnings before interest, tax, depreciation and amortisation were up 30% and 46% annually. Action is a Benelux-based discount retailer.
‘Action has once again delivered some very impressive results and starts the New Year with good momentum across all ten of its geographic markets. The fundamentals of the business and financial model are very strong and its low prices and flexible category format are generating significant customer traffic,’ said Chief Executive Simon Borrows.
3i said its total realised proceeds in the third quarter amounted to £474 million, picking up from £193 million across the whole of the first-half, taking the year-to-date figure to £667 million.
It made £38 million worth of investments during the quarter.
Meanwhile, Diageo slumped by 6.0%.
The London-based brewer and distiller said pretax profit increased 13% to £3.06 billion from £2.72 billion a year earlier. It also reported net sales of £9.42 billion in the six months to December 31, up 18% year-on-year from £7.96 billion.
The company declared an interim dividend of 30.82 pence per share, up 5% from 29.36 pence.
Looking ahead, Diageo said it expects to return up to £4.5 billion of capital to shareholders in February. It also reiterated its medium-term guidance, between financial year 2023 and 2025, of organic net sales growth in the range of 5% to 7%.
In the FTSE 250, Tate & Lyle was amongst one of the best performers, up 4.1%.
The sweeteners and food ingredients maker said that revenue was up 16% in the three months to December 31.
It said that Food & Beverage Solutions top-line momentum continued with revenue up 19%. However, revenue from its Sucralose arm was down 8%, reflecting the unwind of orders phased into the first half. Tate & Lyle added that it expected this fall.
Looking ahead, Tate & Lyle said its outlook for the financial year ending March 31 is unchanged. It continues to expect revenue growth ‘reflecting current top-line momentum’.
Also in the FTSE 250 index, IG Group was up 2.1%.
The London-based contracts-for-difference trading provider said that in the six months ended November 30 revenue jumped 10% to £519.1 million, up from £471.5 million a year earlier.
Pretax profit, however, fell by 2% to £240.5 million from £245.2 million year-on-year.
The company declared a 2.3% increase in its interim dividend of 13.26 pence, up from 12.96p.
IG said that it is extending its share buyback programme by £50 million, to a total of £200 million.
Looking ahead, IG said it expects financial year 2023 to be in line with expectations and reiterated its medium-term guidance.
Elsewhere in London, holiday airline Jet2 was up 3.1%.
The company said it expects to beat current market expectations for financial year 2022, with pre-foreign exchange revaluation pretax profit between £370 million and £385 million.
Looking ahead, the company said on-sale seat capacity for summer 2023 is currently 6.6% higher than summer 2022 at 15.2 million seats.
Provident Financial was up 1.1% after it said it will change its name to Vanquis Banking Group to reflect its new focus on credit cards, vehicle finance and personal loans.
Malcolm Le May plans to step down as chief executive officer in the summer and will be replaced by Ian McLaughlin, currently the CEO of Bank of Ireland UK.
Provident Financial said trading was in line with market expectations in the fourth quarter of 2022, amid strong net lending.
In Tokyo on Thursday, the Nikkei 225 index closed down 0.1%.
In China, the Hang Seng index in Hong Kong was up 2.1%, after its five-day weekend celebrating the Lunar New Year
Stock markets in China have been shut all week to mark Lunar New Year. Hong Kong re-opened on Thursday, while Shanghai will remain closed until Monday.
There was also some positive news from China about the spread of Covid-19.
The number of daily Covid-19 deaths in China has fallen by nearly 80% since the start of the month, authorities have said, in a sign that the country’s unprecedented infection surge may have started to abate.
In Sydney, financial markets were closed on Thursday to celebrate Australia Day.
Wall Street ended largely flat on Wednesday, with the Dow Jones Industrial Average and the S&P 500 flat and the Nasdaq Composite down 0.2%.
Brent oil was quoted at $86.37 a barrel at early in London on Thursday, up from $86.11 late Wednesday. Gold was quoted at $1,940.83 an ounce, up against $1,933.82.
Still to come on Thursday’s economic calendar there is some UK data, including an unemployment insurance claims report and new residential sales data.
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