London close: London stocks close higher with help from insurers and relative calm in N.korea

Mon 11 Sep 2017

LONDON (SHARECAST) - (ShareCast News) - London stocks closed higher on Monday, helped along by a strong showing in the insurance sector as worries about Hurricane Irma and North Korea abated.
The 100 was up 0.49% to 7,413.59, as investors set aside their concerns about North Korea - at least for now - breathing a sigh of relief that the country chose not to launch more missiles to celebrate its 69th anniversary over the weekend.

European markets went the same way with the DAX up 1.39% to 12,475.24, the CAC 40 1.24% higher to 5,176.71 and the IBEX 35 1.91% up to 10,322.60.

IG analyst Joshua Mahony said: "Markets have started the week in a positive fashion, with risk assets firmly in the driving seat at the expense of the commonly perceived havens such as gold, treasuries, and the yen." adding, "It has been notable that the FTSE has held up well despite a surging pound and a significant degree of geopolitical risk associated with North Korea."

"Given that North Korea has provided one of the main drivers of volatility in recent weeks, today's UN meeting over the potential implementation of further sanctions on the country will be crucial in gauging how likely we are to see further tests in the near future. With the US pushing for an oil embargo on North Korea, the Chinese and Russian decisions will be key, where their cooperation would be a kick in the teeth for Pyongyang leadership, sparking a likely military response."

Insurers Prudential, Admiral, RSA, Direct Line, Beazley, Lancashire and Hiscox all made healthy gains as Hurricane Irma was downgraded from a Category 4 storm to Category 1 by early Monday.

Commenting on the impact of Irma on US Property & Casualty insurers, Citi's James Naklicki told clients: "In our view, a direct hit to Miami would have resulted in a plethora of capital raises for the Reinsurance industry, a theme that was at least partially priced in last week. Given the relatively less damaging path of Irma, we now see the risk of capital raises as a lot less likely.

"For now, the industry has dodged a bullet, but we are only a little over half way through Hurricane season (June 1 - Nov 30), so some risk remains."

The likes of Admiral and Direct Line were also likely to still be benefiting from last week's news about changes to the Ogden discount rate.

Elsewhere, Provident Financial was on the front foot following a Telegraph story over the weekend suggesting the subprime lender is planning big changes to its controversial doorstep lending business as it looks to reverse a restructure that prompted profit warnings.

AstraZeneca rallied as it said it had seen positive results from two trials for lung cancer treatments, while Derwent London racked up healthy gains after saying it has pre-let most of the remaining office space at 80 Charlotte Street in London to The Boston Consulting Group.

Kaz Minerals advanced after appointing John Hadfield as its new chief financial officer with effect from January 2018.

British Land was boosted by an upgrade to 'buy' at Deutsche Bank, while SIG was lifted by an upgrade to 'buy' at Canaccord.

On the downside, Associated British Foods was in the red despite saying group operating profits will be "well ahead" of last year after its Primark clothing arm was able to reduce levels of price promotion, with the sugar business also adding a hefty spoonful to the bottom line.

Outsourcer Carillion slumped as it announced that its finance director has left the company with immediate effect with three other directors departing at the end of the month.

Shares in Petra Diamonds tanked after the company confirmed that a parcel of diamonds from its Williamson mine in Tanzania has been blocked from export to its marketing office in Antwerp and some of its key personnel from Williamson are being questioned by the authorities.

The statement was made in response to earlier press reports about the findings of an investigation into the diamond sector by a parliamentary committee in Tanzania. Petra said "the grounds upon which these actions have been taken have not been formally made know to the company" yet, but according to reports, the government has accused Petra of declaring a lower value when trying to export the gems.

Market Movers

FTSE 100 (UKX) 7,413.59 0.49%
FTSE 250 (MCX) 19,694.26 0.43%
techMARK (TASX) 3,465.71 0.20%

FTSE 100 - Risers

Provident Financial (PFG) 825.00p 3.77%
easyJet (EZJ) 1,195.00p 3.37%
Carnival (CCL) 5,180.00p 2.88%
International Consolidated Airlines Group SA (CDI) (IAG) 607.50p 2.36%
Rio Tinto (RIO) 3,678.00p 2.15%
AstraZeneca (AZN) 4,890.00p 2.09%
Antofagasta (ANTO) 1,026.00p 1.79%
Glencore (GLEN) 369.30p 1.72%
British Land Company (BLND) 609.00p 1.67%
Prudential (PRU) 1,790.00p 1.59%

FTSE 100 - Fallers

Associated British Foods (ABF) 3,103.00p -4.96%
Convatec Group (CTEC) 271.80p -2.30%
Randgold Resources Ltd. (RRS) 8,000.00p -1.54%
Johnson Matthey (JMAT) 2,864.00p -1.41%
Micro Focus International (MCRO) 2,394.00p -1.24%
Fresnillo (FRES) 1,607.00p -0.86%
Tesco (TSCO) 186.15p -0.85%
Croda International (CRDA) 3,867.00p -0.85%
Ashtead Group (AHT) 1,684.00p -0.65%
Morrison (Wm) Supermarkets (MRW) 246.90p -0.56%

FTSE 250 - Risers

Lancashire Holdings Limited (LRE) 674.00p 10.31%
JD Sports Fashion (JD.) 341.90p 4.77%
Beazley (BEZ) 470.20p 4.26%
Wetherspoon (J.D.) (JDW) 1,028.00p 3.78%
Kaz Minerals (KAZ) 816.00p 3.55%
Hiscox Limited (DI) (HSX) 1,265.00p 3.35%
Derwent London (DLN) 2,859.00p 3.21%
Rank Group (RNK) 236.40p 2.96%
Rathbone Brothers (RAT) 2,594.00p 2.95%
SIG (SHI) 176.40p 2.86%

FTSE 250 - Fallers

Petra Diamonds Ltd.(DI) (PDL) 84.85p -5.67%
Acacia Mining (ACA) 183.00p -4.69%
Tullow Oil (TLW) 155.00p -3.38%
Stobart Group Ltd. (STOB) 293.30p -3.27%
Bovis Homes Group (BVS) 1,100.00p -2.90%
Sirius Minerals (SXX) 26.20p -2.89%
Greene King (GNK) 539.50p -2.88%
Polymetal International (POLY) 868.50p -2.58%
Dixons Carphone (DC.) 164.60p -2.26%
Cobham (COB) 135.60p -2.24%
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