Growing optimism around the reopening of the economy sent the FTSE 250 to its highest level ever last night.
The mid-cap index, seen as a better gauge of the health of the UK economy because of the more domestic focus of its constituents, has been on a tear over the winter and into spring, fuelled by the country’s stellar vaccination rollout.
Since the start of November, the FTSE 250, which is home to companies such as JD Wetherspoon and Marks & Spencer, has risen by almost a third and it added another 166.09 points, or 0.8 per cent, to close at 22,160.57 last night. That surpassed its previous best of 22,108.29, which it reached last January, a few weeks before the spreading pandemic sent stock markets tumbling.
Investors have flocked to buy domestic stocks over the past couple of days after Boris Johnson’s upbeat announcement over the weekend that pub gardens and shops would reopen as planned on Monday and his suggestion that the rest of his “road map” out of lockdown was on track.
Analysts think that the successful vaccine campaign, coupled with the last-ditch Brexit deal at the end of last year, have helped to restore the reputation of British companies among the City’s big investors.
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Emmanuel Cau, head of European equity strategy at Barclays, said: “The worst-case scenario [on Brexit] being avoided was definitely a relief. For the past four years, there was an excuse for investors not to be investing in the UK because there was this risk.”
The FTSE 100 also rallied sharply yesterday as it put on 61.77 points, or 0.9 per cent, to reach a three-month high of 6,885.32, although it remains 9 per cent shy of where it was before last February’s crash. The Footsie, whose constituents make three quarters of their profits overseas, has been hamstrung by its heightened sensitivity to sterling’s strong start to this year.
Leading the charge in London yesterday were companies best-placed to benefit from the easing of lockdown restrictions. Shoe Zone, the high street shoes seller, strode 6½p, or 9.8 per cent, up to 72p; Card Factory, the greetings cards retailer, improved 5¼p, or 6.9 per cent, to 82½p; and Escape Hunt, which runs Escape Rooms around the country, climbed 2p, or 5.9 per cent, to 36p.
Trainline, the ticketing app, was among the few travel and leisure stocks to miss out. Its shares dropped 6¼p, or 1.3 per cent, to 476¾p — good news for George Soros, the billionaire investor, who has shorted the stock.
Greggs also retreated 30p, or 1.3 per cent, to £22.42 after some more selling from its bosses. After big sales in recent weeks from Roger Whiteside, the chief executive, and his wife, Richard Hutton, Greggs’ finance director, banked £230,000 after cashing in some of his shares.
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FinnCap boasted that its latest results would be better than expected after a string of fundraisings and initial public offerings last month. It now predicts that income for the past 12 months will total about £47.3 million, 83 per cent more than the year before. The stock zipped 2¾p, or 8.6 per cent, higher to 34¼p.
FireAngel heated up after it unveiled a tie-up with an unnamed German energy provider that will involve the pair designing and manufacturing a next-generation smoke alarm. John Conoley, FireAngel’s executive chairman, estimated that his company stood to collect up to €21 million (£18 million) over the lifetime of the partnership, which until yesterday was equivalent to its total market value. The shares leapt 11p, or 75.9 per cent, to 28p.
Chinese tycoon bets on cinema
Liu Zaiwang, the secretive Chinese tycoon, has again topped up his stake in Cineworld, the world’s second largest chain of cinemas.
Liu, 49, first invested in Cineworld last August, taking advantage of the company’s depressed share price as it battled through the pandemic.
Through his Jangho Group, the businessman, who made his money building curtain walls for some of China’s most prominent skyscrapers and airport terminals, bought more shares last week. He now owns 13.8 per cent of the company, according to regulatory filings, a stake worth about £200 million after Cineworld shares closed 2¼p, or 2.1 per cent, lower at 103¼p yesterday.
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The latest purchase cements his position as its second largest shareholder, behind Moshe “Mooky” Greidinger, the chief executive, and his family.
Liu, who is estimated to have a net worth of about £573 million, has never publicly addressed his intention behind his investment in Cineworld, but that has not stopped smaller shareholders from speculating about it on social media and online trading forums.
Wall Street report
The S&P 500 eked out another record close, rising 6.01 points, or 0.1 per cent, to 4,079.95 after the Federal Reserve said it was in no rush to raise interest rates. The Dow Jones industrial average rose 16.02 points, or 0.1 per cent, to 33,446.26.
