Reckitt nudges FTSE higher on cleaning products boom


Reckitt Benckiser (RB) has helped the FTSE 100 inch higher after reporting a 13.3% jump in third quarter sales, as the coronavirus pandemic boosted demand for cleaning products.

Shares in the consumer goods group rose 1.8% to £73.34, helping the FTSE 100 climb 17 points, or 0.3%, to 5,902.

‘Reckitts was already seeing the benefits of improving hygiene and self-care awareness, and the pandemic has moved growth to another level,’ said Richard Hunter, head of markets at Interactive Investor.

‘With the real possibility that changing attitudes towards health and hygiene will become entrenched, Reckitts is well positioned and the market consensus of the shares as a “buy” reflects that optimism.’

Leading the way on the FTSE 100 was International Consolidated Airlines (IAG), up 5.6% at 105.6p as shares in the British Airways owner were boosted by Heathrow Airport’s launch of a 20-minute Covid-19 test for passengers flying to destinations where a negative test is needed to skip quarantine.

But gains were capped by the looming as a deadline for US politicians to agree a fresh round of stimulus looms and Covid-19 cases around the world continue to climb.

Spreadex analyst Connor Campbell said ‘it feels like we are entering a potentially choppy period for the markets’ as the US presidential election draws nearer and House of Representatives speaker Nancy Pelosi’s 48-hour deadline for stimulus talks ends tonight with an agreement appearing far from being reached.

On top of the political stalemate, the coronavirus crisis is escalating, with Europe recording a record number of new daily Covid-19 cases yesterday, prompting a tightening of restrictions. In the UK, Wales announced it would enforce a two-week ‘circuit breaker’ lockdown from Friday to try and stem the tide of virus cases.

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‘Not only are investors grappling with the idea that the world’s largest economy will have to wait for additional stimulus, rising coronavirus cases are also dragging on sentiment,’ said Fiona Cincotta, analyst at City Index.  

UK ‘mid-cap’ companies on the FTSE 250 climbed 0.4%, though shares in Softcat (SCT) fell 7.3% to £11.51.

Although the IT group saw profit grow 12% in 2020 and declared a final dividend of 16.6p, Jefferies analyst Paul Kratz said the near-term outlook remained ‘subdued as the market adjusts to a new normal’ and low single-digit earnings growth was likely next year.



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