LONDON MARKET OPEN: FTSE 100 Outperforms In Mixed European Start

(Alliance News) - London stocks were posting cautious gains amid a mixed European open on Monday, with strong overnight economic data from China unable to provide markets with a substantial boost.

The FTSE 100 index was up 10.22 points, or 0.2%, at 6,377.80 early Monday. The mid-cap FTSE 250 index was just 3.84 points higher at 19,466.55. The AIM All-Share index was up 0.8% at 1,047.54.

The Cboe UK 100 index was up 0.2% at 635.20. The Cboe 250 was up 1.1% at 16,766.02, and the Cboe Small Companies up 0.3% at 11,307.75.

In mainland Europe, the CAC 40 in Paris was down 0.7% while the DAX 30 in Frankfurt was down 0.5% early Monday.

"It seems the market is doing a lot of "hitting the pause button" these days as year-end approaches, and I do not think investors care if it was a November to remember they will continue to defend against the prospects of dreadful Covid infused Christmas Eve," said Stephen Innes, chief global markets strategist at Axi.

He added: "Taking stock of most recent developments, the anticipated holiday season US Covid case counts explosion notwithstanding, we are likely still in a muddied environment for risk in the coming weeks."

America should prepare for a "surge upon a surge" in coronavirus cases as millions of travellers return home after the Thanksgiving holiday, top US scientist Anthony Fauci warned Sunday.

"We may see a surge upon a surge" in two or three weeks, Fauci added. "We don't want to frighten people, but that's the reality."

Oil majors were among the worst blue-chip performers in London on Monday. BP shares were down 3.1% and Royal Dutch Shell 'A' and 'B' shares down 2.6% and 2.8% respectively.

Brent oil was trading at USD47.33 a barrel early Monday, down from USD48.05 late Friday.

"Both crude and Brent prices are trading lower as it seems that there may not be a positive agreement between the OPEC+ cartel on the oil supply. The market has been expecting an extension of the current agreement...However, it seems like that extending the current oil production cut isn't likely," said Naeem Aslam of AvaTrade.

The OPEC+ club of oil producers meets this week.

Lloyds slipped 0.9% as it chose Charlie Nunn as its next chief executive officer.

Nunn is currently global chief executive for Wealth & Personal Banking at fellow lender HSBC. He joined HSBC in 2011, having also held roles including global chief operating officer of Retail Banking & Wealth Management and head of Wealth Management & Digital.

Incoming Lloyds Chair Robin Budenberg said: "I am excited about Charlie's vision for Lloyds Banking Group, as well as his passion for and commitment to our purpose of helping Britain prosper. Given his career track record, he will bring world class operational, technology and strategic expertise to build on the strengths of the existing management team."

Added outgoing CEO Antonio Horta-Osorio: "Charlie will find a warm welcome at Lloyds Banking Group and a deep commitment from all of our people to deliver on our purpose and to help Britain recover."

HSBC said that HSBC Bank PLC Chief Executive Nuno Matos has been appointed chief executive of Wealth & Personal Banking to replace Nunn. Prior to his current role, which also includes being chief executive of HSBC Europe, Matos was CEO of HSBC Mexico, joining the bank in 2015.

HSBC shares were down 1.5% in opening dealings.

Indivior was the top performer in the FTSE 250, up 7.4% and staging a partial rebound from Friday's 20% slide.

On Friday, Indivior announced Reckitt Benckiser had submitted a GBP1.07 billion claim against the company. The claim related to an indemnity contained in the demerger agreement entered into between the two companies in November 2014.

Drug maker Indivior spun off from consumer health and hygiene firm Reckitt and listed on the London Stock Exchange in December of that year.

Indivior on Monday said: "Based on the information available to it, Indivior strongly believes that the claim is without merit and that it has strong grounds for defending against the claim should it be served."

If the claim is served, Indivior will "fully and vigorously" defend itself.

Reckitt shares were up 1.7% on Monday.

Homewares retailer Dunelm was up 5.0% after RBC raised the stock to Outperform from Sector Perform.

Sterling was quoted at USD1.3346 early Monday, firm against USD1.3331 at the London equities close on Friday. The euro traded at USD1.1980 early Monday, higher than USD1.1957 late Friday.

Crunch talks aimed at securing a post-Brexit trade deal between the EU and UK will resume on Monday in what could be the final week of discussions.

The EU's chief negotiator Michel Barnier and his counterpart David Frost will meet again in London as they seek to hammer out an agreement.

With just a month to go until the end of the transition period, talks remain stuck on fishing rights – described by Dominic Raab as an "outstanding major bone of contention". But the UK foreign secretary said there was "a deal to be done" after the EU showed progress on the so-called level playing field aimed at preventing unfair competition.

Without a deal, the UK will leave the single market and customs union on December 31, and trade under World Trade Organisation terms.

In Tokyo on Monday, the Nikkei 225 index closed up 0.8%. Against the yen, the dollar edged up to JPY104.18 versus JPY103.99.

In China, the Shanghai Composite closed down 0.5%, while the Hang Seng index in Hong Kong closed down 2.1%.

China's factory activity grew at its fastest pace in over three years in November, official data showed overnight, as the world's second-largest economy continued its recovery from the coronavirus.

The purchasing managers' index, a key gauge of manufacturing activity in China, has largely rebounded following strict measures to curb the virus early in the year, coming in at 52.1 this month. This was higher than October's reading of 51.4, and remains above the 50-point mark separating growth from contraction. Consensus, according to FXStreet, had pencilled in a reading of 51.5.

The latest figures also bring the PMI data back to levels seen in September 2017.

The non-manufacturing PMI came in at 56.4 in November, slightly higher than the month before, signalling further recovery in the services sector.

Gold was quoted at USD1,778.84 an ounce early Monday, lower than USD1,786.40 on Friday.

In Monday's economic calendar, there is German inflation at 1300 GMT.

By Lucy Heming; lucyheming@alliancenews.com

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