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London open: Stocks gain as Chinese exports rise more than forecast
UK stocks gained on Wednesday as data revealed Chinese exports rose in March for the first time in nine months.
China exports rose 11.5% in March year-on-year in dollar terms, according to the General Administration of Customs. The increase was more than the 10% expected by analysts and compared to a 25.4% drop in February.
Imports in March fell 7.6%, less than the 10.1% drop expected and following a 13.8% decline in February.
“China’s trade data for March point to healthy growth in import volumes and add to growing evidence that the extreme gloom of a few weeks ago about the state of the domestic economy was misplaced,” said Capital Economics.
The figures come a day after the International Monetary Fund said China’s slowdown may not be as severe as first thought, revising its economic growth forecasts to 6.5% this year and 6.2% next year, both up two-tenths of a percentage point from the last outlook.
Meanwhile, oil prices snapped the rally seen on Tuesday with Brent crude falling 0.97% to $44.26 and West Texas Intermediate decreasing 1.4% to $41.58 per barrel at 0859 BST.
A report from the Department of Energy on weekly crude inventories at 1530 BST could move the market later.
US retail sales data at 1330 BST will also be in focus.
In company news, Tesco’s shares dropped after chief executive David Lewis cautioned that the grocer’s focus on investment in the customer offer to cope with the cut-throat UK grocery market will impact profitability particularly in the first half of the year. The company swung to a £162m pre-tax profit that marked a turnaround from the previous year’s record £6.3bn loss, but fell short of expectations for £541m.
Halfords rallied as the car parts-to-bikes retailer said full year revenues rose 1.7%, driven by a strong final quarter where sales rose 3.2%.
Shares in Mr Kipling and Oxo owner Premier Foods tumbled on Wednesday as US-based McCormick & Co. said it did not intend to make an offer for the company.
Engineering group WS Atkins advanced as it said it traded well through the fourth quarter and expects underlying results for the year to the end of March to be in line with views.
