Yahoo Finance FTSE 100 Live: Oil and gold ease on mooted US-Russia summit, Clipper Logistics and John Menzies takeover talk
Traders have welcomed the prospect of a US-Russia summit as tensions on the Ukraine border continue to dominate market sentiment.
Oil and gold prices eased overnight after presidents Biden and Putin agreed to the potential meeting, which has raised hopes for a diplomatic solution to the crisis.
At the start of another busy week for corporate results, two potential mid-cap takeovers are taking shape.
The board of aircraft refuelling business John Menzies is willing to back an improved £558 million offer from Kuwait's National Aviation Services, while Clipper Logistics is recommending a proposal worth £920 million from GXO Logistics.
FTSE 100 Live Monday
John Menzies and Clipper back takeovers
FTSE 100 steady on Ukraine summit hopes
PrimaryBid raises $190 million from SoftBank
UK firms worth £3bn fall into foreign hands
11:41 , Simon English
THREE UK firms worth a near combined £3 billion were set to fall into foreign hands today in the latest sign that markets could be gearing up for a post Covid deal frenzy.
First, Clipper Logistics accepted a 920p a share bid from US rival GXO Logistics, a deal that sees a key provider of deliveries for M&S, John Lewis, JD Sports and Asda disappear from the stock market.
John Menzies, the cargo group that works for airlines across the world, is going the same way.
It has accepted a £558 million bid from Kuwaiti firm Agility. That is at a much-improved 608p a share, having rejected earlier bids at 460p and 510p.
Meanwhile, the government has dropped its probe into the £1.2 billion takeover of robot software group Blue Prism by America’s SS&C. It will delist from the London Stock Exchange in March.
PurpleBricks hits all-time low
11:32 , Simon Hunt
Shares in online estate agent Purplebricks reached an all-time low of 19.3p today as the company faces the spectre of a lawsuit from self-employed workers demanding compensation for lost holiday pay and pension contributions.
The Purplebricks share price has plunged 96% since its all-time high of 515p in August 2017. The company reported a loss of £20.2 million in the six months to October 2021, following increased costs after the company shifted its business model to permanently employ its sales workers amid increased scrutiny of the treatment of workers in the gig-economy.
Morses Club crashes
11:12 , Oscar Williams-Grut
Shares in subprime lender Morses Club have more than halved in value after its CEO unexpected quit on the eve of a profit warning.
Paul Smith, who has been CEO since 2015, is to leave the board with immediate effect. Current COO Gary Marshall is to take his place, pending regulatory approval.
Filings show Smith offloaded a significant chunk of his shares in Morses last Friday. The company said it had “no prior notification” of the sale, worth around £194,000.
In the same statement, Morses Club said profits for the current year are set to be 20% to 30% lower than expectations following increased costs associated with handling compensation claims.
Morses blamed a “rapid” increase in the volume of claims submitted recently. Claims are made in batches by companies on behalf of customers who argue they have been treated unfairly.
Diplomatic efforts help steady FTSE 100
10:45 , Graeme Evans
The prospect of a last-ditch Biden-Putin summit brought some relief for traders today as financial markets in Europe avoided more Ukraine-led volatility.
There had been fears of another downbeat session until it emerged that France had successfully brokered a potential meeting between the US and Russia presidents.
The move halted upward pressure on the prices of oil and safe haven asset of gold, while the FTSE 100 index stood 24.04 points higher at 7537.66 after falling 1.9% last week.
The mood among traders, however, remains tense despite the latest efforts at a diplomatic solution to the Ukraine crisis. AJ Bell investment director Russ Mould said: “Like everyone else, investors are left scratching their heads trying to decipher what the Russian leader’s end-game is and until that becomes clear then nervousness is likely to remain.
As well as geopolitical developments, travel and leisure stocks benefited from today's plans for the lifting of Covid-19 restrictions in the UK as British Airways owner IAG rose 2p to 163.6p and Rolls-Royce was a penny stronger at 118.2p.
But London's main support came from the financials sector ahead of a busy week of corporate results. NatWest, which fell on Friday after it lowered its cost-cutting target, recovered 5.2p to 239.7p and HSBC cheered 8.9p to 553.3p prior to figures due tomorrow.
The biggest faller was Baillie Gifford's tech-focused Scottish Mortgage Investment Trust, which slipped 3% or 30.8p to its lowest level since October 2020 at 984.2p.
There was also further pressure on safety technology group Halma, whose shares have fallen more than 20% so far this year in a big reversal of fortunes. Halma today said it was buying a US-based light measurement business for £19.5 million but shares fell another 21p to 2265p to leave shares at their lowest since March.
Animal medicines business Dechra Pharmaceuticals had a mixed session despite reporting a 50% rise in half-year operating profits. Shares initially traded 4% higher but were later 24p cheaper at 3760p in a further to blow its chances of staying in the FTSE 100 index beyond next month's quarterly reshuffle.
The FTSE 250 index fell 32 points to 21330.54, with one of the best performers being cyber security firm Darktrace after a 6% rebound.
Inflation eats into profits at Finsbury Foods
10:27 , Oscar Williams-Grut
The maker of Mary Berry cakes has suffered a 23% drop in profits despite record sales, as the company battles inflationary pressure and supply chain issues.
Cardiff-based baker Finsbury Foods, which also makes products under the Thorntons and Costa brands, saw revenues increase 9% to £166.5 million in the six months to 25 December, driven by growth in its overseas unit and an expansion of its gluten-free product range.
But pre-tax profit fell from £7.4 million to £5.7 million. Chief executive John Duffy cited “challenges arising from sudden and unexpected input cost inflation”. Staff shortages and supply chain problems also weighed on performance.
Shares slipped 1.9p, or 2.1%, to 86.6p.
Deliveroo IPO platform raises $190 million
09:33 , Oscar Williams-Grut
PrimaryBid, the platform that lets small-time investors buy into IPOs, has raised $190 million from Japanese investment giant SoftBank.
London-based PrimaryBid has raised the cash from investment round led by SoftBank’s Vision Fund 2. The startup is understood to be valued at around $700 million in the deal.
PrimaryBid’s tech lets companies sell shares to retail investors during stock market listings and rights issues. These large transactions have traditionally been the preserve of big institutions because of the complexity and cost of dealing with lots of small-time investors.
To date, PrimaryBid’s platform has helped companies raise more than $1 billion across 200 transactions. The company’s most high-profile deal in the UK was supporting Deliveroo’s disastrous IPO in March 2021.
FTSE 100 higher, IAG lifts 3%
08:56 , Graeme Evans
Optimism over the potential US-Russia summit helped the FTSE 100 index to climb 52.32 points to 7565.94, a rise of 0.7%.
Travel and leisure companies are most in demand, with British Airways owner IAG up 3%. Russian steel producer Evraz gained 3% and there are improved sesssions for stocks in the mining and financial sectors, including Barclays and Anglo American.
Animal medicines business Dechra Pharmaceuticals, which joined the FTSE 100 last year, rose 2% after reporting a 50% rise in half-year operating profits.
Safety technology group Halma, whose shares have fallen more than 20% this year, got back on the risers board by unveiling a deal to buy a US-based light measurement business for £19.5 million. Shares rose 8p to 2294p.
The FTSE 250 index added 62.79 points to 21,425.39, with Wizz Air and easyJet among those up by more than 2%. John Menzies has risen 5p to 588p and Clipper Logistics is up 14% or 111p to 888p after their respective takeover developments.
Mid-cap pair back takeover deals
08:11 , Graeme Evans
Prices have been agreed for takeovers at aviation services business John Menzies and online retail specialist Clipper Logistics.
Menzies has been valued at £558 million after its Edinburgh-based board backed an improved approach from Kuwait's National Aviation Services at 608p a share.
Clipper Logistics, which handles online orders for major retailiers, has reached agreement on a cash and shares approach from New York-listed GXO Logistics worth £920 million.
Both deals are subject to the completion of due diligence and other conditions.
Oil and gold prices ease
07:49 , Graeme Evans
Stock market nerves steadied today as it emerged that US President Joe Biden and Russian President Vladimir Putin have agreed to meet in an effort to resolve Ukraine tensions.
The proposed summit, which was brokered by France, will only take place in the event that Russia does not invade.
Wall Street is closed today for Presidents Day, but the developments helped US futures swing into positive territory overnight. The FTSE 100 index is poised to open 15 higher at 7528, having fallen by more than 1.5% last week.
Oil prices returned to below $94 a barrel after the summit plan was announced, with investors also monitoring a potential Iran nuclear deal that could lead to the return of its supplies to a stretched energy market.
Gold earlier hit an eight-month high of $1908 an ounce before settling back at $1890.
