The UK’s major shares made a slow start to trading on Monday but news of a second buyout offer for supermarket chain Morrisons (MRW) will dominate investor chatter.
Investors will also have a eye on an announcement later today on the easing of lockdown restrictions on July 19, with Boris Johnson set to encouragement Britons that they will have to adapt to life with Covid rather than hiding from it.
The benchmark FTSE 100 drifted 0.1% to 7,115.53 in early trading but mid-caps rallied. The FTSE 250 index rose 0.3% to 22,818.47 after Morrisons jumped 11% to 267p, topping the mid-cap leaderboard, after US private-equity firm Apollo Global Management said it was considering a possible offer for the British company, which on Saturday agreed to a £6.3 billion takeover from rival private equity firm Fortress.
The news follows a rejected bid last month from a third private equity group, Clayton, Dubilier & Rice, whose £5.5 billion proposal was turned down immediately. Morrisons said it ‘significantly undervalued’ the company and its future prospects.
Asia’s main markets provided mixed messages earlier, while the US is taking an Independence Day break.
AROUND THE MARKET
Engineer IMI (IMI) was off 2% at £17.33 after Goldman Sachs cut its recommendation from ‘buy’ to ‘neutral’.
Hipgnosis Songs Fund (SONG), the owner of the rights to artists including Neil Young and Shakira, drifted 0.7% to 121.86p despite reporting a jump in annual earnings and raised its dividend.
HydrogenOne Capital Growth said it plans to list on the London stock market to raise £250 million to investing in clean hydrogen projects. The company said it expects to publish a prospectus shortly for the 100p per share offering on the LSE’s premium segment, and to close the issue by end July.
Defence contractor Ultra Electronics (ULE) firmed 1.9% to £23.45 after it said trading in the first half had been ahead of its expectations.
Ultra, in an update for the six months to 2 July, said its order book continued to grow and was significantly ahead of last year.
Franchising group Franchise Brands (FRAN:AIM) added 1% to 152p on announcing that it expected to report annual results 'at least' in line with market expectations.
Sales at the company's Metro Rod drainage services unit, it said, had returned to pre-Covid growth levels in the first half.
Data management group Restore (RST:AIM) climbed 4% to 406.75p, having confirmed that it would reinstate its dividend for the first half, following a strong second quarter.
Restore said trading continued to strengthen through the first half, with second-quarter performance ahead of its previous expectations.
Technology services group The Panoply (TPX:AIM) rallied nearly 7% to 301p, despite posting a full-year loss after a 62% jump in revenue was more than offset by expenses.
The Panoply, however, upgraded guidance for the current financial year, saying it expected revenue and operating earnings to be ‘significantly’ ahead of current market forecasts.