London close: Shares dip despite fresh M&A news

Mon 12 Mar 2018

LONDON (SHARECAST) - (ShareCast News) - London stocks failed to build on the gains seen on Wall Street at the end of last week as investors mulled over news that London house prices have slumped over the last year, while M&A was in focus as Melrose sweetened its hostile bid for GKN.
The FTSE 100 finished 0.13% lower at 7,214.76, while the pound was up by 0.4% against the dollar to 1.3902 and 0.2% firmer versus the euro at 1.1271.

On Friday, the Nasdaq hit a record high as US stocks rallied on the back of solid jobs data, which revealed the perfect combination of a much stronger-than-expected non-farm payrolls number and a worse-than-expected wage growth reading.

According to David Madden at CMC Markets UK: "It has been a lacklustre session today as it was a quiet day on the news front. The mood was optimistic in general, but a slide in commodity prices left the FTSE 100 disadvantaged in relation to its Continental counterparts. Only some of the bullish sentiment from the Asian session has slipped over to Europe."

Investors were also digesting uninspiring news that house prices in some parts of London have fallen as much as 15% in the last year. Figures from estate agency YourMove revealed that house prices in Wandsworth dropped by more than 100,000 in the last 12 months.

On the corporate front, turnaround specialist Melrose Industries was on the back foot as it upped its hostile offer for engineer GKN to 467p per share, or 8.1bn from 7.4bn. The sweetened 'final' offer comes after GKN announced on Friday that it had agreed to combine its automotive business, Driveline, with US-based Dana in a deal valued at around $6.1bn. GKN was also trading lower.

Polymetal International was in the red as it said net profit declined 10% in 2017 while generic drug-maker Hikma Pharmaceuticals also retreated after saying it will carry out a clinical trial of its generic version of GlaxoSmithKline's Advair Diskus asthma drug after consultation with the US drug regulator.

AstraZeneca was little changed as it said it has pushed back the expected completion of the Phase III 'Mystic' clinical trial of its Imfinzi immunotherapy treatment of non-small cell lung cancer.

Petrofac gushed higher as it was awarded a lump-sum 27-month engineering, procurement and construction (EPC) contract by Bharat Petroleum Corporation (BCPL) valued at around $135m.

Clarksons gained as it posted a 12% jump in full-year underlying pre-tax profit amid early signs of a recovery across shipping markets.

In broker note action, Just Eat was downgraded to 'sell' at Deutsche Bank, while Smurfit Kappa was cut to 'neutral' at UBS. Aveva was downgraded to 'neutral' at Citi and Virgin Money was reduced to 'hold' at Jefferies.

Cairn Energy was lifted to 'overweight' by Morgan Stanley, while CYBG was upped to 'buy' at Jefferies.

Market Movers

FTSE 100 (UKX) 7,214.76 -0.13%
FTSE 250 (MCX) 20,117.53 0.16%
techMARK (TASX) 3,390.41 -0.01%

FTSE 100 - Risers

easyJet (EZJ) 1,608.00p 2.85%
Evraz (EVR) 448.40p 2.61%
Pearson (PSON) 767.00p 2.08%
Admiral Group (ADM) 1,945.50p 1.65%
SEGRO (SGRO) 607.40p 1.40%
Schroders (SDR) 3,441.00p 1.20%
Rentokil Initial (RTO) 275.60p 1.17%
Next (NXT) 4,820.00p 1.01%
Coca-Cola HBC AG (CDI) (CCH) 2,546.00p 0.99%
Experian (EXPN) 1,596.00p 0.98%

FTSE 100 - Fallers

GKN (GKN) 423.60p -2.53%
NMC Health (NMC) 3,450.00p -2.16%
Reckitt Benckiser Group (RB.) 5,697.00p -1.94%
SSE (SSE) 1,235.00p -1.87%
BT Group (BT.A) 235.00p -1.84%
Rolls-Royce Holdings (RR.) 910.40p -1.60%
Imperial Brands (IMB) 2,555.00p -1.50%
Ferguson (FERG) 5,252.00p -1.24%
BAE Systems (BA.) 596.60p -0.86%
Just Eat (JE.) 781.60p -0.86%

FTSE 250 - Risers

Galliford Try (GFRD) 981.50p 11.53%
Acacia Mining (ACA) 144.75p 8.26%
Cairn Energy (CNE) 211.40p 7.33%
Equiniti Group (EQN) 326.50p 5.49%
Barr (A.G.) (BAG) 664.00p 3.75%
Assura (AGR) 60.20p 3.44%
Marshalls (MSLH) 456.60p 3.40%
Softcat (SCT) 651.00p 3.17%
Fisher (James) & Sons (FSJ) 1,666.00p 3.09%
FDM Group (Holdings) (FDM) 1,018.00p 3.04%

FTSE 250 - Fallers

Inmarsat (ISAT) 409.70p -5.32%
Melrose Industries (MRO) 213.50p -4.98%
AA (AA.) 79.82p -4.09%
Hochschild Mining (HOC) 203.70p -3.73%
Dignity (DTY) 882.00p -3.40%
Vectura Group (VEC) 79.50p -2.27%
Hikma Pharmaceuticals (HIK) 880.00p -2.05%
IMI (IMI) 1,115.00p -2.02%
Bovis Homes Group (BVS) 1,171.50p -2.01%
Hill & Smith Holdings (HILS) 1,317.00p -2.01%
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21 Mar London close: Stocks finish on a mixed note amid pound weakness
20 Mar London close: Dip in pound fails to stem selling pressure
19 Mar London close: FTSE 100 hits highest close since early October
18 Mar London close: Stocks jump as Speaker of the House sends pound lower