London open: Stocks steady but ZPG zooms higher on takeover

London stocks were flat in early trade on Friday despite positive cues from the US and Asia, with little in the way of market-moving news, although ZPG was a bright spot after the Zoopla owner agreed to be bought by US private equity firm Silver Lake.

At 0840 BST, the FTSE 100 was steady at 7,699.57, while the pound was up 0.1% against the euro to 1.1355 and flat against the dollar at 1.3523.

The pound was dragged around the day before after the Bank of England downgraded its outlook on the UK’s growth and inflation as well as keeping rates on hold.

CMC Markets analyst Michael Hewson said there was a "distinctly more dovish flavour to the narrative" from the BoE.

"While governor Carney attempted to put a brave face on the downgrades by suggesting that rate hikes still remain on the table for this year, and that the bank expected the slow down seen in Q1 GDP to be temporary, markets didn’t appear to be buying the narrative on this occasion, sending sterling down towards its lowest levels this year against the US dollar."

Speaking to BBC radio on Friday morning, BoE deputy governor Ben Broadbent denied that the central bank was sending out mixed messages on interest rates: "We have given some guidance that we are going to raise rates over the next few years but that has never been a promise that we are going to raise rates at a particular point in time," he said.

"If you read what we said in the early part of the year it was clearly a conditional statement. It says if the economy turns out in line with the forecast then interest rate rises may comes sooner than people expected."

There are no major UK data releases due on Friday.

In corporate news, Zoopla and PrimeLocation owner ZPG rocketed nearly 30% after agreeing to be bought by US private equity firm Silver Lake Management for 490p per share in cash, or £2.2bn.

BBA Aviation edged higher after saying its trading performance in the first quarter remained in line with expectations, with revenue for the period up 9.7% year-on year, reflecting good organic growth in its Signature division.

3i Infrastructure was a little higher as it hailed an "outstanding" year, with net asset value up 28.6%, while Wood Group racked up strong gains after saying it was seeing good momentum in trading.

On the downside, AstraZeneca slipped after saying that the late-stage Galathea trial for its first respiratory biologic drug failed to meet its primary goal in treatment of chronic obstructive pulmonary disease.

Paragon Banking ticked just a touch lower after announcing the appointment of senior independent director Fiona Clutterbuck as its new chairman with effect from 10 May, succeeding Bob Dench.

Interserve fell as the City watchdog's enforcement division launched an investigation into the company’s handling of inside information and its disclosures to the market over its troublesome exit from the energy-from-waste business.

Embattled retailer Carpetright was in the red as it said it has agreed a £15m unsecured loan from its biggest shareholder, Meditor, ahead of its planned £60m equity placing next week.

Bakery chain Greggs was a touch lower after Berenberg downgraded the stock to ‘hold’ and Severn Trent was under the cosh as Bernstein cut the stock to ‘underperform’ from ‘market perform’.

Market Movers

FTSE 100 (UKX) 7,699.57 -0.02%
FTSE 250 (MCX) 20,777.46 0.38%
techMARK (TASX) 3,489.41 -0.14%

FTSE 100 - Risers

Randgold Resources Ltd. (RRS) 5,804.00p 2.29%
ITV (ITV) 164.00p 2.28%
easyJet (EZJ) 1,725.00p 2.10%
Anglo American (AAL) 1,830.20p 1.67%
Glencore (GLEN) 381.80p 1.49%
BHP Billiton (BLT) 1,693.20p 1.43%
Antofagasta (ANTO) 1,053.65p 1.31%
Rio Tinto (RIO) 4,249.50p 1.26%
G4S (GFS) 263.50p 1.15%
Fresnillo (FRES) 1,308.50p 1.08%

FTSE 100 - Fallers

Severn Trent (SVT) 1,973.50p -2.30%
United Utilities Group (UU.) 768.40p -1.64%
InterContinental Hotels Group (IHG) 4,745.00p -1.64%
British American Tobacco (BATS) 3,869.50p -1.16%
Kingfisher (KGF) 294.90p -0.81%
National Grid (NG.) 837.40p -0.77%
GlaxoSmithKline (GSK) 1,465.80p -0.76%
AstraZeneca (AZN) 5,217.00p -0.67%
Barclays (BARC) 212.40p -0.65%
Associated British Foods (ABF) 2,777.00p -0.64%

FTSE 250 - Risers

ZPG Plc (ZPG) 486.20p 29.58%
Wood Group (John) (WG.) 616.60p 4.97%
Rightmove (RMV) 4,820.00p 4.71%
Auto Trader Group (AUTO) 386.00p 4.13%
FirstGroup (FGP) 104.80p 2.95%
Ferrexpo (FXPO) 244.50p 2.60%
Rathbone Brothers (RAT) 2,540.00p 2.50%
Centamin (DI) (CEY) 165.80p 2.09%
Polymetal International (POLY) 722.40p 1.75%
Ted Baker (TED) 2,704.00p 1.73%

FTSE 250 - Fallers

Capita (CPI) 125.40p -2.45%
FDM Group (Holdings) (FDM) 998.25p -2.13%
Convatec Group (CTEC) 229.60p -1.80%
Coats Group (COA) 77.00p -1.16%
Marston's (MARS) 106.20p -1.03%
Spire Healthcare Group (SPI) 227.20p -0.96%
Provident Financial (PFG) 681.00p -0.93%
TP ICAP (TCAP) 443.40p -0.85%
Greene King (GNK) 538.01p -0.85%
Rank Group (RNK) 172.97p -0.82%