Amec sells CFB boiler business to Sumitomo, Ultra Electronics confirms talks to buy Sparton
London open
The FTSE 100 is expected to open 14 points higher on Monday, after closing down 0.2% at 7,424.13 on Friday.
Stocks to watch
Amec Foster Wheeler said it has completed the sale of its circulating fluidised bed (CFB) boiler business to Sumitomo Heavy Industries for $170m, which will be used to reduce net debt. The CFB boiler business is the largest part of Amec's GPG unit. The remaining GPG steam generator businesses include the heat recovery steam generator and industrial boilers businesses and these are also expected to be sold during 2017, Amec said.
Ultra Electronics was forced to respond to press speculation over the weekend, after Mergermarket reported it was in talks to acquire its underwater sensors joint venture partner in a bid to strengthen its contractual ties with the US Navy. The FTSE 250 company said it could confirm it was in “advanced discussions” to acquire NYSE-listed Sparton Corporation, subject to regulator and shareholder approvals. Should Ultra acquire Sparton, the board said it intended to sell Sparton's other business, the Manufacturing & Design Services (MDS) division.
Newspaper round-up
The status of Bond Street as the UK’s most exclusive shopping destination is under threat, as one in four retailers on the famous street consider shutting up shop and moving out as a result of high rents and business rates. About 25 of the 100 top fashion brands with stores on Old and New Bond Street are understood to have flagged to the property market that they are ready to quit the world-famous fashion district. Dolce & Gabbana, Hugo Boss, De Beers and DKNY are among the big brands understood to be considering their options. - Guardian
Rupert Murdoch is about to learn whether the government has cleared his latest bid to buy Sky or whether concerns about competition could yet derail the deal. The culture secretary, Karen Bradley, will this week deliver her verdict on whether to greenlight 21st Century Fox’s proposed £11.7bn takeover of the satellite broadcaster, or refer the deal to the competition authorities for further scrutiny. – Guardian
EDF is bracing for a multi-billion euro rise in costs at its Hinkley Point C nuclear site after a fresh evaluation of the project revealed yet another likely delay. An internal review of the troubled project by senior executives at EDF’s French headquarters is expected to confirm fears that the state-backed energy giant will not be able to deliver Hinkley on time or in line with its £18bn budget. The French newspaper Le Monde reported over the weekend that sources close to the review have said no one believes it can be delivered by 2025. – Telegraph
South African fund Pallinghurst Resources is set to vote through today a move to take over Aim-listed miner Gemfields. The Johannesburg-listed company will put the plan to its shareholders at a general meeting in Guernsey this morning, where it expects to count on the backing of 50.3pc of investors who have pledged “irrevocable” support. – Telegraph
A retail investment fund backed by Mikhail Fridman, the Russian billionaire, has struck its first deal, agreeing to buy Holland & Barrett for £1.77 billion. L1 Retail is expected to confirm today that it is buying the health retailer from Nature’s Bounty, an American maker of vitamins and health supplements owned by Carlyle, a US private equity group. – The Times
Victims of the HBOS Reading scandal have called for the resignation of the head of the compensation scheme after it emerged that he has indirect business connections with the fraudster who ran the scam. Russel Griggs, the independent reviewer appointed by Lloyds to oversee a £100 million redress process for victims, was for three years a director of Future Route, a company backed by Parkmead. – The Times
US close
Wall Street finished on a mixed note, led by shares in aluminum and other metals companies amid better than expected economic data and some dovish Fedspeak.
The Dow Jones Industrial Average drifted lower by 0.01% or 2.53 points to 21,314.76, with the Nasdaq Composite adding 0.46% or 28.56 points to 6,265.25 and the S&P 500 adding 0.16% or 3.80 points to 2,438.30.
Oil prices also traded higher as the diplomatic spat between several Arab countries and Qatar continued to worsen. Against that backdrop, West Texas Intermediate crude oil futures rose by 21 cents to $43.01 a barrel.
That was despite figures from Baker Hughes showing the the number of US oil rigs in operation climbed for a 23rd successive week, rising by 11 to 758.
Craig Erlam, senior market analyst at Oanda, argued that while oil prices were clawing back some of their losses from earlier in the week, there was little reason to believe this was anything more than a dead cat bounce and that next week may be another painful one.
From a sector standpoint the biggest gains were seen in the following industrial groups: Aluminium (4.33%), Coal (3.83%) and Nonferrous Metals (2.71%).