Leading UK shares are moving sharply higher in early trading, catching up on the gains in Europe on Monday when London markets were closed for the Bank Holiday.
The FTSE 100 is back above the 7000 level, up 59.48 points at 7045.43. Disappointing construction manufacturing figures have hit the pound but supported shares, on the basis that an interest rate rise in the UK receeds even further into the distance.
But there are still concerns about Greece running out of cash before it can reach a deal with its creditors, as well as uncertainty ahead of the UK general election this week.
News that Australia had cut interest rates did little to support mining shares, which are suffering some profit taking following recent increases.
Glencore is down 4.4p at 308.25p after weaker than expected first quarter production figures, with copper down 9%. Bernstein remained positive on the stock despite admitting the results were disappointing:
Glencore reported its first quarter 2015 production results this morning, which were quite disappointing overall with performance in both base metals and coal behind our initial expectations. Copper production was affected by lower grades and planned maintenance. Nickel was stronger, increasing on a year on year basis, but technical issues at Koniambo slowed down the ramp up process. Coal was stronger, especially in South Africa but is expected to decline this year due to voluntary production cuts that should affect operations later this year. Today’s results do not materially alter our opinion on the stock. We reiterate our outperform rating, target price £4.50.
Anglo American has fallen 19p to £11.46 as RBC Capital Markets downgraded the miner:
Low bulk prices have been discounted, but now Anglo faces the prospect of weaker contribution from De Beers which will further slow an improvement in the balance sheet. We downgrade to underperform [from sector perform] with a £9 a share price target [from £11].
BHP Billiton is down 18.5p at £15.89 while Rio Tinto has lost 29.5p at 2967.5p.
Aberdeen Asset Management has slipped 11.8p to 451.3p as net outflows came in higher than forecast. Numis said:
This is far from Aberdeen’s finest hour, with most key metrics being a little disappointing and a relatively cautious short term outlook from the company. We remain comfortable with our hold recommendation, balancing the subdued near term outlook against reasonable value (in particular the total yield) and the longer term potential.
HSBC is down 4.3p at 642p despite better than expected results, but defensive stocks such as pharmaceuticals and utilities are in demand. GlaxoSmithKline has climbed 35p to 1546.5p while United Utilities is up 20p at 978p.
Among the mid-caps Just Eat has jumped 13.8p at 469.8p as the online takeaway specialist issued an upbeat trading statement, with total orders up 51%.
