LONDON, Oct 8 — British midcaps rose to their highest levels in nearly two months today following the Bank of England Governor’s upbeat views on Brexit and as a slew of corporate results showed signs of an improvement.
Bank of England Governor Andrew Bailey said he believed Britain and the European Union should be able to reach a trade deal, and that he did not expect the new wave of Covid-19 cases to be as damaging as the first.
Capping the market’s gains, however, Prime Minister Boris Johnson’s government said it is considering additional local Covid-19 restrictions for parts of northern England as the second wave of the novel coronavirus accelerates.
The mid-cap index, considered a barometer for Brexit sentiment, gained 0.5 per cent. Electrocomponent was one of the biggest boosts after it said it expects the virus’ impact to ease in the second half of the year.
The blue-chip index gained 0.2 per cent.
“With hopes of some support from the US and with the pound going up, it has given the market an idea of some positive developments on the Brexit front which also helped mid-caps gain as they are better geared towards Brexit news,” said Chris Bailey, a strategist at Raymond James.
In a heavy earnings day, Ladbrokes and bwin owner GVC Holdings surged seven per cent to a two-year high as it raised its outlook for annual core earnings after posting a 12 per cent rise in its revenue for the third quarter.
British tobacco company Imperial Brands rose 1.3 per cent on forecasting its full-year net revenue to be broadly flat and in line with market estimates.
Supermarket owner Hargreaves Lansdown dropped three per cent after it said it took in £800 million (RM4.3 billion) of net new business in the quarter to September 30, but also said it saw weakening investor sentiment arising from Covid-19 and Brexit uncertainties. — Reuters
