(Alliance News) - Stock prices in London opened mostly lower on Wednesday amid near-term worries about the surge in coronavirus infections, while UK supermarkets rose in a positive read-across from French peer Carrefour.
The FTSE 100 index was down 5.28 points, or 0.1%, at 6,748.83. The mid-cap FTSE 250 index was down 4.18 points at 20,708.78. The AIM All-Share index was up 0.2% at 1,181.25.
The Cboe UK 100 index was up 0.1% at 672.85. The Cboe 250 was flat at 18,009.11, and the Cboe Small Companies was down 0.1% at 12,213.56.
In Paris, the CAC 40 was up 0.2%, while Frankfurt's DAX 30 was 0.1% higher.
UK Prime Minister Boris Johnson and health chiefs will be questioned on the rollout of the coronavirus vaccine after warnings to abide by lockdown restrictions were stepped up to ease pressure on the NHS.
Johnson will be grilled by senior MPs on the liaison committee after facing Labour leader Keir Starmer during PMQs on Wednesday.
Vaccines minister Nadhim Zahawi and health bosses crucial to the jabs programme will also be questioned by the Commons science & technology committee. With rolling out the vaccines key to easing lockdowns, the latest National Health Service figures showed 2,431,648 in the UK have received a first dose.
But the health service was under extraordinary pressure with the number of Covid-19 patients in hospital in England at a record 32,202 as of 8 am on Tuesday – up 22% on a week ago, and 82% since Christmas Day. Latest figures showed that as of Tuesday, a further 1,243 people in the UK had died within 28 days of testing positive for Covid-19, with a further 45,533 cases being confirmed by labs.
In the FTSE 100, supermarkets WM Morrison Supermarkets and J Sainsbury were the best performers, up 2.0% and 1.9% respectively, after French peer Carrefour was subject to bid interest.
The French grocer said it has been approached, "in a friendly manner", by Canada's Alimentation Couche-Tard Group, over a combination project, but stressed discussions were preliminary. Carrefour shares were up 9.0% in Paris.
"The waves from any Carrefour/Couche-Tard tie-up may lap up against British shores quite gently. That being said though, the Issa Bros/TDR (private equity) are in the process of buying the majority of the equity in No.3 British grocer, Asda, from Wal-Mart. With so much low-priced money in the system we can, therefore, expect more such activity, especially for asset backed and defensive entities," Shore Capital's Clive Black said.
"To complete the blue sky thinking, Amazon may yet seek to follow the path it has taken in the US, where it acquired Whole Food Markets for USD14 billion in order to gain a real foothold in the grocery market. We would not rule out a similar step in time in the UK, should it seek to become a serious player, noting its investment in Deliveroo in 2020; Amazon and Wm Morrison Supermarkets have a formal commercial relations," Black added.
At the other end of the large cap index, Just Eat Takeaway was the worst performer, down 4.1%. The online food ordering platform reported positive order growth numbers but also said it is investing heavily in its delivery services.
For the fourth quarter, total orders were 179.8 million, up 57% from 114.9 million orders in the fourth quarter of 2019. For the full year 2020, Just Eat expects revenue growth of more than 50%, with adjusted earnings before interest, tax, depreciation, and amortisation margin of 10%, after the significant investment made in delivery in the quarter.
Just Eat said its acquisition of peer Grubhub in the US should be completed during the first half of this year. Due to that acquisition, it said it is reviewing the listing venues for its shares. As a result, it said it will delay its planned delisting from Euronext Amsterdam and will remain listed in both London and Amsterdam.
Persimmon was down 2.2% after the housebuilder reported a fall in revenue for 2020 as it faced tough challenges due to the Covid-19 pandemic.
For the year, the FTSE 100 housebuilder posted revenue of GBP3.3 billion, down 8.8% from GBP3.65 billion recorded for 2019. New home completions totalled 13,575, down from 15,855 the year prior. However, average selling price rose to around GBP230,500 from GBP215,709.
Dividends paid in 2020 were down 53% to 110 pence from 235p in 2019.
Looking ahead, the York-based company warned that while the vaccine rollout has commenced, uncertainties surrounding the potential impact of the pandemic remain, especially in relation to unemployment levels and consumer confidence. It also expressed concern about the potential impact of an end to the stamp duty holiday in the UK, due at the end of March.
"At this stage, with the end of the stamp duty holiday in sight, taking a cautious view of the immediate outlook is the right approach, but we have seen more bullish outlooks from some of the group's rivals," said Hargreaves Lansdown's Steve Clayton.
The pound was quoted at USD1.3677 on Wednesday morning, up sharply from USD1.3621 at the London equities close Tuesday.
The euro was priced at USD1.2202, up from USD1.2157. Against the yen, the dollar was trading at JPY103.70, down from JPY104.18.
Brent oil was trading at USD57.03 a barrel, up sharply from USD56.61 late Tuesday. Gold was quoted at USD1,862.02 an ounce, higher against USD1,844.07.
In Asia on Wednesday, the Japanese Nikkei 225 index closed up 1.0%. In China, the Shanghai Composite ended down 0.3%, while the Hang Seng index in Hong Kong closed down 0.1%.
Wednesday's economic calendar has eurozone industrial production at 1000 GMT and US inflation at 1330 GMT.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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