FTSE 100 rallies moderately on Tuesday on upbeat earnings reports
- FTSE 100 index records a 1% increase on Tuesday led by Vodafone's upbeat earnings report.
- FTSE 250 remains downbeat on Tuesday posting an around 0.5% decline due to real estate stocks.
- Analysts expect the UK's economy to see the worst recession in 300 years in 2020.
London’s blue-chip index, FTSE 100, rallied moderately on Tuesday as companies reported upbeat financial results for the recent quarter. The better than expected earnings helped remove the fears of slower recovery in the global economy as countries strategize to resume businesses without risking a potential increase in Coronavirus cases.
The FTSE 100 index posted a just over 1% increase on Tuesday. The index opened at 5,939.73 and concluded the daily session on 6,003.55. Earlier in the day, the index touched an intraday higher of 6,010.53. On Tuesday’s close, the FTSE 100 index is still more than 20% down year to date. In March, the index had dropped to as low as 4,993.89.
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FTSE 250 remained downbeat on Tuesday
The mid-cap FTSE 250 index, however, remained downbeat on Tuesday posting an over 0.5% decline. The index opened at 16,271.49 on Tuesday and mostly traded below the opening level to close the session at 16,179.72. On Tuesday’s close, the domestically focused index is more than 25% down year to date. It had dropped to 12,829.70 in March.
Vodafone took the lead in fuelling the gain in the FTSE 100 index on Tuesday as the world’s 2nd largest mobile operator posted full-year profit that came in line with expectations and pushed its stock 6.3% up.
Kingfisher also announced its underlying sales to have returned to the positive territory at the start of May. The home improvement group’s 4.6% jump took the lead in the FTSE 250 index but was insufficient to offset a greater pressure from the real estate stocks.
Other noticeable price actions on Tuesday
Other noticeable price actions in the UK’s stock market on Tuesday included a 3% increase in Morrisons as the supermarket group recorded an increase in its comparable-store sales in the recent quarter, and a 3.6% increase in Standard Life Aberdeen as the asset manager estimated the total worth of its assets at the end of April at £490 billion.
Land Securities came at the bottom of the blue-chip index as it dropped by 11.2% on Tuesday. The UK’s largest property developer recorded its annual pre-tax loss at over £810 million.
The Coronavirus pandemic is weighing heavily on the UK’s economy with analysts expecting 2020 to see the worst recession in the country in 300 years. The next big move in the stock market is expected after the release of Q1 GDP figures on Wednesday.