UK stocks had a mixed start to the week as the FTSE 100 increased 0.44% to 6,578.82 by lunchtime on Monday, with weakness in the pound helping the exporter-heavy index.
Sterling was down against the euro and dollar as sentiment turned negative on the knife-edge Brexit trade talks currently playing out, with the European Union reportedly ‘downbeat’ over the chance of a deal being reached.
Weakness in the pound has a positive impact on the relative value of the overseas earnings which dominate the FTSE 100 index.
While this helped the UK’s benchmark index, the more domestically-focused FTSE 250 – seen as a barometer of Brexit sentiment – fell 0.8% to 20,020.75.
Britain and the EU are making a last-ditch attempt to strike a post-Brexit trade deal this week, striving to solve key sticking points in fishing, governance rules and dispute resolution.
Brexit worries hit domestic-facing sectors like housebuilders and real estate with high end homes specialist Berkeley (BKG) slumping 6.5% to £44.56 to become the biggest faller on the FTSE.
In company news, cloud communication provider Imimobile (IMO) jumped 47% to 591.25p after it accepted a £543 million takeover offer from networking company Cisco Systems.
Imimobile investors would get 595p a share, a 48% premium to the company’s closing price on Friday.
Retailing group Frasers (FRAS), formerly known as Sports Direct, fell 0.8% to 430.4p on confirming it was in negotiations with the administrators of Debenhams about a potential rescue transaction for the latter's UK operations.
Frasers, however, added that ‘time is short’ and that its position was complicated by the recent administration Arcadia, Debenhams’ biggest concession holder.
Miniature wargames maker Games Workshop (GAW) retreated from highs for the day to advance 1% to £99.75 as it guided for a 53% jump first-half profit, buoyed by bumper sales.
Games Workshop also declared an interim dividend of 60p per share, though that was down 40% year-on-year.
Home-improvement retailer Kingfisher (KGF) ticked up 0.3% to 269.5p as it more than halved a cost-savings target, having decided to return rates relief received from the government due to the Covid-19 crisis.
Kingfisher said it now expected its annual pre-tax profit would include about £85 million of non-recurring cost savings, down from previous guidance of about £175 million.
Specialty chemicals firm Elementis (ELM) fell 3.7% to 122p after it rejected a third takeover bid from US rival Minerals Technologies.
The company called the latest offer of 130p per share, which values the firm at £755 million, ‘highly opportunistic’ and ‘coming at a low point of earnings and value’.
Internet of things investor Telit Communications (TCM:AIM) edged 0.25% higher to 201.5p on announcing that a takeover offer lobbed by largest shareholder DBAY Advisers ‘fundamentally’ undervalued the company.
DBAY on Friday flagged a possible offer of £1.90 per share, but then announced it had bought some Telit shares at a highest price of £1.948. Under UK takeover rules, any offer would need to be at or above that price.
Real estate group Land Securities (LAND) fell 2.3% to 709.1p after it acquired an office-led building at 55 Old Broad Street, London, from PGIM Real Estate for £87 million.
Fellow property group CLS (CLI) dropped 3.5% to 219p as it exchanged contracts to acquire two office properties in Berlin, Germany, and Watford, United Kingdom, for a combined £55.9 million.
Alternative asset and corporate services provider Sanne (SNN) shed 2.4% to 561p on announcing that it had acquired private equity fund administrator Private Equity Administrators from founders for up to €30.3 million.
Sanne also said it expected to deliver underlying earnings per share for the year ending 31 December in-line with expectations, ‘despite the market backdrop remaining uncertain’.
Auto dealer Vertu Motors (VTU:AIM) was 0.3% higher at 28p following news that it had acquired a market area of 12 sales outlets in England from Inchcape for £18.7 million, giving it a significant exposure to BMW and Mini vehicles.
Vertu also said its performance had remained ahead of prior year and original budget levels, with pre-tax profit in the nine months through November up around 15%.