Wednesday, June 3: UK stocks climbed to a three-month highs as investors were encouraged by data from China. Chinese data indicated that the service sector returned to growth in May, bolstering hopes of a faster global rebound from a covid-19 induced slump. The FTSE 100 was 1.10% higher shortly after the open, lifted by travel & leisure stocks for the third straight sessions as the government said it would review quarantine procedures for international arrives based on their economic impact.
TUI(+8.52%) was one of the aforementioned to benefit from a quarantine procedure review, but the travel group also announced a deal with Boeing for compensation and slower delivery of the 737 MAX aircraft. The travel group announced last month it needed to cut 8,000 jobs and shed 30% of costs to survive, amid forecasts that travel will take years to recover to 2019 levels. Despite intraday gains, the company’s London-listed shares have halved in value since the beginning of the year.
Chemring Group(+26.23%) led the FTSE 250 higher as it held annual targets and raised its dividend after managing to win new orders from the US, despite the coronavirus crisis. The Defence contractor posted a leap in HY profit, and reported that 95% of the expected revenue for H2 had been delivered to date, after underlying PBT rose to £24.2m in the six months to April 30, from £9.9m a year earlier. Compounding the good news, the Group pointed to an increase in order intake of 1% to £250m, and a 30% reduction in debt to £60.6m, whilst the interim dividend was lifted 8% to 1.3p per share.
European markets were higher at the close, with the FTSE 100 +2.61%, the CAC 40 +3.88% and the DAX 30 +3.86%.