FTSE 100: Investors assess lockdown winners and losers while hopes lift of Brexit breakthrough

Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown

The FTSE 100 has been keeping its head above water as warnings about the financial impact of another lockdown wash in, while a potential life buoy comes into sight as talks resume in Brussels offering fresh hopes for a Brexit breakthrough. There is renewed hope that a compromise on fishing rights between the EU and the UK is close to being reached which has proved a major stumbling block in the negotiations.

Although a barrel of Brent crude had fallen to a five month low amid concerns about the impact of further lockdowns on global demand, it’s been ticking up this morning, helping lift energy giants BP and Shell.

Retailers with a large high street presence are on the back foot. JD Sports and Primark owner ABF are among the top fallers, as investors fret about the impact of store closures in the crucial seasonal shopping period. Shares in Premier Inn owner Whitbread initially fell sharply as it counts the cost of hospitality closures. Airline group IAG also descended into the red as rival Ryanair warns of a tough winter ahead with passenger numbers already down by 80%.

However, the companies which have already been big beneficiaries of the shift to digital sales during the pandemic are rising. Shares in Ocado have surged by more than 9% as the e-grocer said customers are shifting to online grocery shopping in record numbers, with its Marks and Spencer joint venture already showing strong trading. Ocado has pushed its profit guidance further into positive territory, with the expectations that online sales during the festive period will accelerate.

Grocers Tesco and J Sainsbury are also rising as shoppers rush to fill up on essentials and book home delivery slots. JustEat Takeaway is riding high today on expectations the appetite for home deliveries will grow as consumers are forced to stay at home – opting to order in their favourite dishes instead.

The new looming lockdown for England is also helping lift the share price of the value retailer B&M. With a large footprint of stores across retail parks, it offers some groceries alongside its extensive general merchandise range, so not only will the chain be allowed stay open but it’s likely to draw in the Christmas shoppers whose options will be severely limited elsewhere.

During the pandemic, DIY has appeared to become a national past time as people stuck at home got stuck into home improvement. The prospect of millions more of us spending more weeks of staring at four walls has boosted shares in B&Q owner Kingfisher, as investors expect a surge in business to help complete those DIY projects which began during lockdown mark 1.