New week, new corona rules
Fiona Cincotta May 11, 2020 6:11 AM
As the UK woke up to the first day of a softer lockdown, relatively little has changed.
As the UK woke up to the first day of a softer lockdown, relatively little has changed. Only a few sectors will benefit immediately from the government’s new rules on going back to work, namely those that cannot function online, particularly manufacturing, agriculture and to some extent transport, but for many industries the lockdown will effectively extend for almost another full month. Nevertheless, the pressures on the financial sector should start easing as more people go back to work, and as shops start preparing to reopen from 1 June. Also, an easing of lockdowns across Europe, especially France where restriction has been among the most strict, is helping lift the trading mood in London.
FTSE gainers are a mixed bag this morning, led by specialty chemicals group Johnson Matthey, delivery firm Ocado and education publisher Pearson. There is very little on the UK earnings agenda on Monday but tomorrow Vodafone and Land Securities are due to report, Premier Foods on Thursday and Ted Baker on Friday.
The government’s decision to introduce a two-week quarantine for all travellers entering the UK is hitting the already battered airlines even further because, if left in place over the summer, they will effectively scupper summer holiday travel this year. EasyJet shares dropped 7.5% and British Airways owner IAG traded 2.5% lower.
Crude oil prices plateau
Brent crude prices have been rising for a full two weeks now, ever since the dip into negative territory on 21 April, but have plateaued over the weekend and have started the new week more than 3% lower. Investors have been snapping up very cheap oil futures ever since the price crash, but now that gains have been made, they are beginning to pull out of the June contract, fearing a repetition of a price collapse closer to the 22nd of the month when the June contract expires
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