Pound boosted by rebound in UK service sector

The services sector in the UK experienced its strongest rise in activity in 2017 so far, thanks to growth in business activity and new work, which boosted the pound 0.4% against the euro.

The Purchasing Managers’ Index jumped from 53.3 in February to 55 in March.

Miners and oil giants remained on top as strong commodity prices helped the stocks maintained momentum.

West Texas Intermediate and Brent crude oil eased back to $51 and $54.38 per barrel, respectively.

Gold fell 0.6% to $1,247 per ounce and copper rallied 2% to $5,864 per ounce.

OVERSEAS MARKETS

Banks in the US helped the Dow Jones and S&P 500 rise 0.7% and 0.5% respectively on Wednesday. A private report also revealed the fastest pace of hiring in the US since 2014.

This was also the focus in Asia as investors brushed off concerns following North Korea’s test-firing of a medium-range ballistic missile into the Sea of Japan.

Shanghai’s SSE Composite rallied 1.5% on Wednesday, while indexes in Japan and Hong Kong made smaller advances.

FTSE 100 RISERS AND FALLERS

DCC (DCC) announced that DCC Energy agreed with Shell Gas Holdings BV to acquire its liquefied petroleum gas business in Hong Kong and Macau based on an enterprise value of HK$1.165bn (£120m). The stock advanced 1.8% to £71.45.

FTSE 250 RISERS AND FALLERS

Commercialisation of technology play Allied Minds (ALM) said it would be undertaking a restructuring, reallocating capital and management resources across the portfolio and pipeline to accelerate commercialisation. It would result in discontinued funding for seven subsidiaries, triggering a drop of 28.2% to 187.3p.

The UK’s leading retirement housebuilder McCarthy & Stone (MCS) nudged 1.4% lower to 182.4p after its first-half pre-tax profit fell 25% amid trading constrained by a lower forward order book. Management blamed uncertainty following the Brexit vote for the disappointing results.

Housebuilder Bovis Homes (BVS) walked away from merger talks with Galliford Try (GFRD) and appointed ex-Galliford boss Greg Fitzgerald as its new chief executive. Bovis gained 5.4% to 892p and Galliford was up 0.6% to £14.71.

SMALL CAP RISERS AND FALLERS

London housebuilder Telford Homes (TEF) was more positive than its peers in a pre-close trading update which said it expected record revenue and profit for the year to 31 March, ahead of expectations. The stock was marked 2.3% up at 368.2p.

Chinese medicine manufacturer Taihua (TAIH) reported it wants a general meeting to seek shareholder approval to cancel its listing on AIM and to re-register the company as a private firm. Over half of its value was wiped off, which left the shares stagnant at 1.2p.

Equipment rental business HSS Hire (HSS) reversed 11% to 59.8p as its adjusted pre-tax profit was flat at £5.8m. Management said it was a year of significant operational change and investment to ensure sustainable profit growth.

Real Good Food (RGD) acquired an 84.3% stake in Brighter Foods for up to £9m, on a cash and debt free basis. The deal was expected to be immediately earnings enhancing to the group. Investors recognised the value of the deal as the stock jumped 26.4% to 31.6p.

Miner Firestone Diamonds (FDI), sparked 14% to 51p following the recovery of its largest diamond to date, which was a 110 carat gem-quality light yellow diamond, at its Liqhobong diamond mine.

Story provided by StockMarketWire.com

Merryn

Claim 12 issues of MoneyWeek (plus much more) for just £12!

Let MoneyWeek show you how to profit, whatever the outcome of the upcoming general election.

Start your no-obligation trial today and get up to speed on:

  • The latest shifts in the economy…
  • The ongoing Brexit negotiations…
  • The new tax rules…
  • Trump’s protectionist policies…

Plus lots more.

We’ll show you what it all means for your money.

Plus, the moment you begin your trial, we’ll rush you over THREE free investment reports:

‘How to escape the most hated tax in Britain’: Inheritance tax hits many unsuspecting families. Our report tells how to pass on up to £2m of your money to your family without the taxman getting a look in.

‘How to profit from a Trump presidency’: The election of Donald Trump was a watershed moment for the US economy. This report details the sectors our analysts think will boom from Trump’s premiership, and gives specific investments you can buy to profit.

‘Best shares to watch in 2017’: Includes the transcript from our roundtable panel of investment professionals – and 12 tips they’re currently tipping. The report also analyses key assets, including property, oil and the countries whose stock markets currently offer the most value.