(Alliance News) -Â Economic recovery hopes saw London stocks start the week on the front foot, after the US Senate over the weekend approved a USD1.9 trillion fiscal stimulus package and England started the first phase of its lockdown easing roadmap.
The FTSE 100 index was up 26.12 points, or 0.4%, at 6,656.64 early Monday. The mid-cap FTSE 250 index was up 131.08 points, or 0.6%, at 21,092.39. The AIM All-Share index was down 0.1% at 1,161.72.
The Cboe UK 100 index was up 0.6% at 664.91. The Cboe 250 was up 0.8% at 18,834.38 and the Cboe Small Companies up 0.5% at 13,606.08.
In mainland Europe, the CAC 40 in Paris was up 0.4%, while the DAX 30 in Frankfurt was up 0.6% early Monday.
The Senate on Saturday voted to approve a USD1.9 trillion relief package, a day after data showed US hiring picked up sharply in February as Covid-19 cases fell and vaccines fuelled hopes for more growth ahead.
Passed by 50 votes to 49 in a strict party-line vote, the sweeping legislation now heads back to the Democratic-majority House of Representatives, where it is expected to be adopted, barring a last-minute setback.
"I promised the American people help was on the way," said President Joe Biden in an address from the White House.
Even without the progressive priority of a minimum wage increase to USD15 an hour, the stimulus bill marks a victory for Biden's Democrats as they put their stamp on the recovery from a pandemic that has killed more than 500,000 people in the US and hobbled its economy. The legislation would send out USD1,400 stimulus checks to most Americans and allocates USD350 billion to state and local governments and USD130 billion to schools.
On Friday, figures showed the US economy added 379,000 jobs in February, following an upwardly revised 166,000 rise in January. The latest figure was more than double market expectations, cited by FXStreet, of 182,000 jobs.
Meanwhile, the first step of UK Prime Minister Boris Johnson's lockdown easing roadmap for England was playing out with pupils returning to school for the first time in two months.
Johnson hailed the "truly national effort" to reduce coronavirus levels with the country on the cusp of marking the first phase of lockdown easing as classrooms reopen this week. But, despite an improving picture in terms of declining Covid cases in England, the Conservative Party leader said he wanted to be careful not to "undo the progress we have made".
According to the prime minister's road map, the second part of stage one, which will allow outdoor gatherings of either six people or two households, is due on March 29. Shops could open by April 12 and all restrictions could possibly be lifted by June 21.
Post-pandemic recovery names were amongst the best performers at the start of the week, with jet engine maker Rolls-Royce up 3.0% and British Airways-parent International Consolidated Airlines up 2.5%. Cruise firm Carnival rose 6.2% and Anglo-German tour operator Tui gained 3.7%.
Phoenix Group rose 2.9% after the London-based insurance services provider said its performance improved in 2020.
Phoenix reported record cash generation of GBP1.7 billion for 2020, exceeding the upper end of its GBP1.5 billion to GBP1.6 billion target range, and ahead of GBP707 million posted for 2019. Pretax profit for 2020 jumped to GBP1.27 billion from GBP351 million year-on-year, as revenue rose to GBP4.70 billion from GBP4.18 billion.
At the bottom of the FTSE 100 was Pearson, down 4.3%. Pearson's revenue for 2020 fell by 12% to GBP3.40 billion from GBP3.87 billion, though pretax profit rose to GBP354 million from GBP232 million.
On the profit rise, Pearson said: "The increase is due to the gain on sale of our stake in Penguin Random House and lower restructuring costs which more than offset the impact of COVID-19 and portfolio changes on adjusted operating profit."
Underlying revenue declined 10%, the education publisher said, with adjusted operating profit dropping 46% to GBP313 million from GBP581 million. The profit figure was broadly in line with consensus, which lay at GBP309 million.
For the year ahead, Pearson expects revenue growth, with adjusted operating profit to be in line with current market expectations.
"Pearson's strategy is now geared around three key demand-led global market opportunities which play to all our strengths: the rise in online and digital learning; addressing the workforce skills gap; and meeting the growing demand for dependable accreditation and certification," said Chief Executive Andy Bird.
"Following significant investments in technology and comprehensive restructuring, Pearson is moving at pace and ready to enter a new era as a digital-first company, focused on delivering sustainable revenue and profit growth for the benefit of all company stakeholders."
Pearson proposed a stable final dividend of 13.5p to bring the full-year payout to 19.5p, also flat on 2019.
The worst performer in the FTSE 250 was Micro Focus, falling 4.7% as it said it intends to appeal any patent litigation judgement in favour of Wapp Tech Ltd Partnership and Wapp Tech Corp.
In 2018, Wapp brought a claim against Micro Focus in the Eastern District of Texas, accusing the company of infringing claims of three patents in connection with the manufacture and sale of some products in the ADM product line, including LoadRunner and Performance Center.
The jury on Friday delivered a verdict in favour of Wapp and awarded damages of USD172.5 million. The matter is awaiting the judge to hand down his judgement, Micro Focus noted, and the total damages awarded could increase.
"Micro Focus has received comprehensive and clear advice from its external counsel that it has a very strong case to appeal both the infringement verdict and the amount of the damages. Accordingly, Micro Focus intends to appeal any judgement resulting from the verdict. Micro Focus continues to contend that there has been no infringement of any intellectual property and its advice from external counsel continues to support this," said Micro Focus.
London oil stocks got a lift after Brent prices topped USD70 a barrel for the first time since the start of 2020.
BP shares were up 1.3% in early trade, with Royal Dutch Shell 'A' and 'B' shares both up 1.4%.
Brent oil was trading at USD70.60 a barrel early Monday, jumping from USD68.74 late Friday after a missile and drone attack targeted the heart of Saudi Arabia's oil industry on Sunday in an assault claimed by Yemen's Huthi rebels. Brent prices hit an overnight high of USD71.38.
The attack on energy giant Saudi Arabian Oil Co's facilities came as the Saudi-led military coalition bombed Yemen's Huthi-controlled capital Sanaa after intercepting a separate flurry of cross-border Huthi drones and missiles.
Gold was quoted at USD1,694.89 an ounce early Monday, a touch lower than USD1,697.43 on Friday.
Sterling was quoted at USD1.3831, edging up from USD1.3813 at the London equities close on Friday.
The euro traded at USD1.1891, lower versus USD1.1912 late Friday. Against the yen, the dollar rose to JPY108.44 versus JPY108.21.
In Asia on Monday, the Japanese Nikkei 225 index ended down 0.4%. In China, the Shanghai Composite closed down 2.3%, while the Hang Seng index in Hong Kong closed down 1.9%.
Monday's economic calendar has Bank of England Governor Andrew Bailey speaking on the UK's economic outlook at 1000 GMT.
By Lucy Heming;Â lucyheming@alliancenews.com
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