FTSE 100 recovers lost ground following Ukraine sell-off

The FTSE 100 staged a strong recovery on Friday as traders reversed much of the falls seen a day earlier after Russia invaded Ukraine.

London’s leading index closed the day up 282.08 points, or 3.91%, at 7489.46 in the biggest single-day rise since November 2020 – a day that saw Pfizer announce its Covid-19 vaccine was 90% successful.

Traders appeared to believe the impact of international sanctions against Russia may not destabilise the economy and also noted that EU leaders were still wrangling over some of the details.

Chris Beauchamp, chief market analyst at online trading platform IG, said: “While the situation in Ukraine continues to keep markets on edge, we have seen a recovery in risk appetite this afternoon. Whether this lasts long into next week is a much bigger question.

“Bargain hunters have jumped into the FTSE 100 today, prompting a surge in stock prices that rivals yesterday’s declines.

“European markets have made headway too, but the gains are much less impressive here, as investors continue to fret about the economic dislocation to the European economy from higher gas prices and sanctions.”

Just two companies saw shares fall out of the 100 listed on the FTSE 100 – Fresnillo and JD Sports – whilst the biggest risers included Russian-facing mining giants Evraz, up 19.5%, and Polymetal up 17%. Both had fallen heavily on Thursday and failed to fully recover from those drops.

In France, the Cac closed up 3.55% and the German Dax was up 3.67%.

The pound fell back against the euro to 1.191 and the dollar at 1.34.

A barrel of oil was 97.05 dollars – a 2% fall on the day.

In company news, British Airways owner IAG said it expects to return to profitability in the second quarter of the year as it unveiled its results.

Losses were halved from £7.8 billion to £3.5 billion before tax last year, with revenues up 8.3% to £8.5 billion in the year to December.

The number of passengers it carried was at 58% of 2019 levels in the last three months of the year, up from 43% in the quarter before.

Shares closed up 7.12p at 154.52p.

Package holiday firm On The Beach also said it was improving as restrictions ease but was knocked by the spread of the Omicron variant.

Bosses said sales in September and October were above pre-pandemic levels but subsequently fell back. They are now 2% down versus 2019 since the start of the financial year, it added. Shares closed up 20.5p at 275.5p.

Property portal business Rightmove said it saw a more than two-thirds rise in pre-tax profit last year, reaching £225.6 million as the business said that the number of customers using its upgraded package doubled in 2021. Shares closed up 27.8p at 643.4p.

And Mike Ashley’s Frasers Group announced it had bought online retail business Studio Retail out of administration for £26.8 million, saving 1,500 jobs, it said. Shares in Frasers closed up 17.5p at 638.5p.

The biggest risers on the FTSE 100 were Evraz up 33.45p at 204.7p; Polymetal up 116p at 798.4p; Pearson up 72.6p at 672.6p; Standard Chartered up 44.8p at 559.6p and Lloyds up 3.14p at 49.68p.

The only fallers on the FTSE 100 were JD Sports down 3.25p at 150.25p and Fresnillo down 2.2p at 713.6p.