London open: Stocks edge higher in quiet trade; IWG surges as it confirms bid approach
London stocks edged higher early on Wednesday, with trade expected to be quiet during the lull between Christmas and New Year, although there was some M&A news to keep things interesting.
At 0830 GMT, the FTSE 100 was 0.3% higher at 7,611.46, while the pound was up 0.1% against the dollar at 1.3391 and flat versus the euro at 1.1275.
Supermarket retailers and heavily-weighted miners were the standout gainers, with Sainsburys, Tesco, Fresnillo, Antofagasta and BHP Billiton sitting at the top of the risers.
FTSE 250 flexible office workspace provider IWG surged 23% as it noted recent press speculation and confirmed it has received an indicative proposal from funds managed by affiliates of Canada’s Brookfield Asset Management and Onex Corporation regarding a possible cash offer for the company.
Oil giant Royal Dutch Shell gushed higher after saying it expects the potential economic impact of the recently-enacted US tax reform legislation to be favourable to it and its US operations, mainly due to the future reduction in the US corporate income tax rate to 21% from 35%.
Business-to-business information company Ascential was little changed after announcing the acquisition of e-commerce analytics group Clavis for up to $219m.
Great Portland Estates nudged up as it exchanged contracts to sell 30 Broadwick Street to a client of Savills IM for a headline price of £190m, equating to £186m after deductions for tenant incentives. This is slightly ahead of the September 2017 book value, reflecting a headline net initial yield of 4% and a capital value of £2,015 per sq ft.
3i Infrastructure ticked up a touch as it agreed to spend £186m to take ownership of Wireless Infrastructure Group alongside its management.
With little going on in equity or forex markets, Bitcoin provided some action.
FXTM chief market strategist Hussein Sayed said: “After crashing by more than $8,000 from an all-time high, Bitcoin is up 3.5% at the time of writing. Although the recent plunge frightened many bitcoin fans, when looking at the relatively short history of bitcoin trading, the price action seems just normal. During 2017 the cryptocurrency crashed by 30% or more six times. Every fall was followed by huge price appreciation until it peaked on 17 December.
“Whether the Bitcoin bull market is close to an end or just pausing for a short break, remains to be a wild question for 2018. I still believe that Bitcoin is in a bubble formation. However, there’s no effective test to measure at which stage we are currently standing. For example, equity prices may be said in a bubble territory if investors are willing to pay much more for a stock than the intrinsic value which is justified by the discounted divided stream. Similarly, econometric tests may be run on bonds, commodities, currencies or any other asset to come up with a justified value. For Bitcoin, there isn’t any fundamental basis to justify the price.”
FTSE 100 - Risers
Sainsbury (J) (SBRY) 241.50p 1.47%
Tesco (TSCO) 209.65p 1.40%
Fresnillo (FRES) 1,367.00p 1.26%
Antofagasta (ANTO) 975.50p 1.19%
BHP Billiton (BLT) 1,480.50p 1.16%
Rio Tinto (RIO) 3,789.00p 1.13%
Randgold Resources Ltd. (RRS) 7,215.00p 1.12%
Glencore (GLEN) 379.95p 1.08%
Anglo American (AAL) 1,517.00p 1.07%
Smurfit Kappa Group (SKG) 2,480.00p 1.02%
FTSE 100 - Fallers
Sky (SKY) 999.50p -1.53%
TUI AG Reg Shs (DI) (TUI) 1,511.00p -1.37%
Micro Focus International (MCRO) 2,466.00p -1.32%
Coca-Cola HBC AG (CDI) (CCH) 2,348.00p -1.30%
Rolls-Royce Holdings (RR.) 850.25p -1.08%
Carnival (CCL) 4,855.00p -0.98%
Diageo (DGE) 2,665.00p -0.91%
easyJet (EZJ) 1,432.00p -0.90%
Imperial Brands (IMB) 3,103.00p -0.83%
Ferguson (FERG) 5,380.00p -0.83%
FTSE 250 - Risers
IWG (IWG) 246.98p 23.37%
Acacia Mining (ACA) 199.02p 4.80%
Daejan Holdings (DJAN) 6,053.80p 2.96%
Tullow Oil (TLW) 205.20p 2.50%
RHI Magnesita N.V. (DI) (RHIM) 3,995.00p 1.89%
Hochschild Mining (HOC) 257.70p 1.74%
Centamin (DI) (CEY) 154.84p 1.73%
Cairn Energy (CNE) 221.30p 1.70%
Petrofac Ltd. (PFC) 498.10p 1.61%
Millennium & Copthorne Hotels (MLC) 590.00p 1.55%
FTSE 250 - Fallers
SIG (SHI) 170.98p -2.63%
Ocado Group (OCDO) 355.20p -1.80%
Sirius Minerals (SXX) 23.21p -1.42%
Pets at Home Group (PETS) 173.80p -1.42%
Marshalls (MSLH) 433.83p -1.40%
Hastings Group Holdings (HSTG) 315.84p -1.30%
Halfords Group (HFD) 346.76p -1.12%
RIT Capital Partners (RCP) 1,954.00p -1.11%
Meggitt (MGGT) 484.70p -1.08%
Softcat (SCT) 514.00p -1.06%