The FTSE 100 made a positive start to trading as it crept back above 7,000 after a volatile couple of days, helped by gains in heavyweight financial and consumer staples stocks, while asset management services firm Sanne (SNN) topped the mid-cap index after rejecting a £1.3 billion buyout proposal.
On global markets, shares snapped a three-day decline, reflecting an overnight revival on Wall Street, as Federal Reserve officials reiterated that price pressures from the reopening of the economy would prove transitory.
The Dow Jones, S&P 500 and tech-heavy Nasdaq Composite all finished higher overnight. The S&P closed 1.2% up at 4,112.50, the Dow 1.3% ahead, while the Nasdaq Composite ended 0.6% ahead at 13,142.99, having lost more than 1,000 points since 26 April.
This lifted the mood in the UK, helping the benchmark FTSE 100 rally 0.6% in early deals to 7,002.58, while the domestically focused mid-cap FTSE 250 advanced 0.65% to 22,212.47.
Still lurking in the background were inflation worries, which were triggered on Wednesday by a shock jump in US consumer prices. Investors remain concerned that a too rapid recovery from the pandemic will force up prices and cause central bankers to row back on the ultra-accomodative monetary policy that has supported equity markets.
Lael Brainard, a Federal Reserve governor, said the central bank would be ‘patient’ in its approach as she highlighted the uneven improvement in the jobs market, but the inflation debate looks set to rumble on for the time being.
SAGE NUMBERS ADD UP
On the market, accounting software firm Sage (SGE) saw interim results give its stock a lift, the share price advancing 3% to 642.8p, topping the FTSE leaderboard.
The figures prompted an upgrade from analysts at Morgan Stanley, which also moved became more positive on the prospects of budget hotelier Whitbread (WTB) as lockdown restrictions in the UK continue to ease, pushing its stock 1.4% higher to £31.04.
Miners led the FTSE loser board in early trading as investors took profits after a strong inflation trade run. Rio Tinto (RIO) was the biggest faller, down 2.5% at £61.48, while red hot copper stock Antofagasta (ANTO) followed closely behind, falling 2.4% to £17.75.
The big corporate story of the day came among the mid-caps, where FTSE 250 specialist asset services firm Sanne jumped 27% after rebuffing a £1.3 billion bid approach from private equity firm Cinven.
Investors were betting that Cinven is not done, and that the failed offer could also draw rival buyers into an auction for Sanne.
Commodities broker Marex Spectron hopes to list shares on the London Stock Exchange’s main market, the company has said.
Marex saw revenue jump 18% to $414.7 million in the year to 31 December 2020, with adjusted operating profit before tax up 15% from $53.4 million to $61.5 million, the company said.
ELSEWHERE ON THE MARKET
Infrastructure investor John Laing (JLG) said it wrapped its investment in the Colombian road public private partnership project Pacifico 2 after receiving all necessary approvals. Its share price rose slightly to 360.66p per share.
Gold production firm Polymetal (POLY) has received an ISS ESG Corporate rating of B-, placing the firm in the Prime sector. It saw growth, climbing to £15.97 per share, up over 1%.
Real Estate company LondonMetric Property (LMP) said it had acquired three logistics warehouses in Croydon, Dunstable and Warrington for a combined £18.7 million. It recovered from an early fall, rising to 225.6p per share.
Irish based resource development company Providence Resources (PVR) has announced the appointment of James Menton as the senior independent non-executive director with immediate effect. It opened up over 1% to 3.54p per share.
Real estate investment trust LXi REIT (LXI) said it had acquired Cazoo click & collect facility in Doncaster and two additional drive-thru coffee units in Edinburgh and Dumbarton for a combined £6.1 million. Its share price rose to 136.4p, up 1.5%.
Home builder Crest Nicholson (CRST) said it expected profit to receive a one-off boost after it agreed to sell its 50% stake in Longcross Studio, a film studio, to Longcross General Partner, an Aviva Investors company. Its share price rose over 2% to 430.40p per share.
Supplier of advanced composite kitting solutions Velocity Composites (VEL:AIM) has signed a new three-year contract with a major Tier 1 aerostructures manufacturer based in Hampshire. Rising by over 20%, its share price grew to 24p per share.