Shares round-up: banks, airlines, travel stocks and Synairgen

With coronavirus vaccine hopes a major catalyst for markets, we look at the top City risers.

A double dose of good news gave investors the courage to sweep up cheap-looking stocks today, with airlines and the UK's beaten-up banking sector among the biggest beneficiaries.

The momentum followed the green light in the early hours of this morning for the European Commission to raise billions of euros on capital markets to help the bloc's 27 members cope with Covid-19. EU summit chairman Charles Michel called it a pivotal moment for Europe.

Markets were also cheered by optimism that a coronavirus vaccine could be available in the UK as soon as Christmas, after a clinical trial by researchers at Oxford University in partnership with AstraZeneca (LSE:AZN) brought encouraging results. 

The developments helped investors put to one side their fears about a potential second wave of the pandemic, with the FTSE 100 index up 0.6% to 6297.5 and the Euro Stoxx 50 ahead 1.5%.

London's biggest risers were British Airways owner International Consolidated Airlines Group (LSE:IAG) and Rolls-Royce (LSE:RR.) after both jumped by 5%. There was also a much-needed rally for the banking sector as Standard Chartered (LSE:STAN), HSBC (LSE:HSBA) and Barclays (LSE:BARC) all improved by 3% or more, although optimism tailed off early afternoon.

Lloyds Banking Group (LSE:LLOY) added 2% to stand 1p above the 30p threshold the popular stock has been stuck at since late March. And on the last day of trading before the company's name change to NatWest Group, The Royal Bank of Scotland (LSE:RBS) shares were 3% higher at 123.5p.

Offsetting the gains in the top flight were losses for housebuilders and mining companies as Persimmon (LSE:PSN) fell 3% and Rio Tinto (LSE:RIO) declined 2%.

The falls in the commodity sector were driven by BHP (LSE:BHP) after it widened the range of its production guidance for next year due to uncertainty over a second wave of the pandemic and the potential impact on China demand. BHP's shares were off 3% at 1,750.4p, despite the company reporting a 7% rise in fourth-quarter iron ore output.

Ladbrokes Coral owner GVC Holdings (LSE:GVC) was the biggest faller in the top flight, having revealed that it is under investigation by HMRC due to matters relating to its former Turkish online gambling business.

Shares in the FTSE 100 newcomer were down 11% at 777p after the disclosure, with analysts at Shore Capital removing their “buy’  recommendation until there's greater clarity over the investigation.

There was better news from former stock market favourite Ted Baker, whose optimism in an AGM trading update translated into a 14% surge for its battered share price.

Recently-appointed CEO Rachel Osborne said customers were responding well to promotional activity, as well as cross-category merchandising, refreshed social media activity and more marketing spend.

E-commerce sales of £35.2 million for the 11 weeks to July 18 were 35% higher than a year ago and accounted for more than half of the retail total in in the period. Even though store sales were down 79%, Osborne said overall trading was ahead of the company's base case scenario. 

Net cash of £56.7 million was also stronger than management expectations.

Osborne said:

“Our performance is encouraging, but I caution that it is still early days, and we have a substantial amount of work to do over the next 12 months against a backdrop of significant uncertainty in the world.”

A trading update from Bloomsbury Publishing (LSE:BMY) also made pleasant reading for investors after it disclosed that revenues for its consumer division surged 28% in the four months to the end of June. White Rage by Carol Anderson, which reached number eight on the New York Times bestseller list, helped US revenues to jump by 38%.

Bloomsbury described its good May and June performance as unexpected, given that bookshops in the UK were only able to re-open a month ago. Print revenues were 9% above last year, while e-book and audio book revenues surged 63%.

The company's shares rose 14% to 228p, from where investors will hope the company can finally build momentum after failing to kick on from this level earlier in the pandemic.

Bloomsbury and Ted Baker (LSE:TED) were comfortably the biggest risers in the FTSE All-Share, followed by Superdry (LSE:SDRY) at 8% stronger and Virgin Money, which climbed 7% to 100p during the upbeat session for the banking sector.

On AIM, the remarkable rise for Synairgen (LSE:SNG) continued after the respiratory drugs company yesterday disclosed positive trial results on a potential treatment for hospitalised Covid-19 patients. The former University of Southampton spin-off surged more than 400% in value yesterday to £54 million, with the stock up another 10% at 210p today.

One of the biggest risers in the FTSE Aim All-Share was Panoply Holdings (LSE:TPX) after the IT services company reported a record first quarter performance and said its involvement in the digital transformation of public services placed it in “one of the few sweet spots of the economy”.

CEO Neal Gandhi added: “Our strong start to the year, which comes off the back of a good performance in Q4, and has continued into Q2 shows that momentum and excitement around the group is increasing.” Shares jumped 25% to 92p.