FTSE rises after tumbling on crypto, inflation concerns

The FTSE 100 index advanced 0.26% to 6,968.55, while the FTSE 250 index added 0.33% to 22,307.36

Leading UK shares endured a volatile morning on Thursday after an earlier rally following positive corporate earnings updates fizzled out, before stocks picked up again shortly after midday.

After a bruising day yesterday linked to cryptocurrency volatility and inflation fears, with Bitcoin falling to $30,000 before recovering to $40,000, investors continue to be split between reopening optimism and inflation concerns.

Having rallied early on and then fallen into the red for an hour, shortly after midday the UK’s benchmark FTSE 100 index had advanced 0.26% to 6,968.55, while the midcap FTSE 250 index had added 0.33% to 22,307.36.

Among the major stock movers earlier in the morning were defence technology company Qinetiq, which climbed after a positive earnings update, while home improvement retailer Kingfisher also gained after it raised its first-half profit outlook.

But after a strong earlier gain, by midday Qinetiq shares were trading just 0.5% higher to 327.8p, while Kingfisher shares dropped into the red after an earlier bounce to trade 0.6% down at 374p.

It came after Kingfisher upgraded its outlook on first-half and annual profit after reporting a jump in sales in the first quarter of the year as strong demand continued.

The company now expects mid-to-high teens group like-for-like sales growth in the first-half versus low double-digits previously. Adjusted pre-tax profit is now anticipated in the range of £580 million to 600 million.

Qinetiq meanwhile reported a 19% rise in revenue for the year ended 31 March, and a 14% increase in its underlying pre-tax profit, despite the pandemic.

Orders were up 18% during the period, and the company said it has approximately £800 million in revenue under contract for FY22.

Banks were soggy on Thursday although NatWest bucked the trend, gaining 0.3% to 198.6p, as RBC upgraded the stock to ‘outperform’.

Budget airline EasyJet said it is readying 90% of its plane fleet as it bets on a pick-up in demand from June despite the ongoing uncertainty around travel, but its stock declined 1.5% to 968.2p as it reported wider first-half losses.

Half-year pre-tax losses jumped more than 80% to £645 million year-on-year (YOY) as revenue dived 89.9% to £240 million.

National Grid rose 1.4% to 943.1p after reporting underlying pre-tax profit of £2.4 billion for the year ended 31 March 2021. That was down 3% when compared with the year before, due to the impact of pandemic restrictions over the past 12 months.

Royal Mail stock shed 1.2% to 518.6p despite announcing a 10p one-off dividend on the back of a 116% profits jump for the year to 31 March 2021.

Asset manager Liontrust climbed 3.5% to £15.88 after saying that it expected revenues to be ahead and adjusted profit pre-tax profit to be ‘significantly’ ahead of market expectations amid strong than expected performance fees.