FTSE 100 movers: GKN rises on bid speculation; JMAT gains on upgrade
London's FTSE 100 was down 0.1% to 7,774.47 in afternoon trade on Monday, with sentiment undermined by the collapse of contractor Carillion.
Engineer GKN was the top gainer following reports that private equity firm Carlyle is considering a bid for the company, after it announced last week that it had rejected a £7bn offer from Melrose Industries. Meanwhile, Melrose said it was beginning a series of shareholder meetings to discuss the proposal.
Berenberg said in a note on Monday that there is an "air of inevitability" that GKN will end up being owned by Melrose.
"The rejected 405p bid undervalues GKN, in our view, but we believe Melrose has scope to significantly increase its offer by the 9 February deadline," it said.
Specialty chemicals company Johnson Matthey was in the black as Berenberg upped is stance on the stock to 'buy' from 'hold' and lifted the price target to 3,680p from 3,350p.
"Recently announced share gains in European autocatalysts should facilitate a return to high-single-digit earnings growth, and we believe it is more than credible in batteries," it said.
Plumbing and heating company Ferguson was on the front foot after saying that recent US tax cuts would provide a beneficial impact on the group's after tax earnings. The company said it expected an effective tax rate of around 25% for the current year to 31 July 2018, from previous guidance of 28%.
Risers
GKN (GKN) 439.36p 4.61%
WPP (WPP) 1,389.50p 2.58%
ITV (ITV) 171.65p 2.17%
Johnson Matthey (JMAT) 3,228.00p 2.02%
Ferguson (FERG) 5,584.00p 1.90%
G4S (GFS) 290.30p 1.19%
Mondi (MNDI) 1,945.50p 1.14%
Pearson (PSON) 730.40p 1.02%
Smith (DS) (SMDS) 507.80p 0.95%
British American Tobacco (BATS) 5,015.00p 0.95%
Fallers
NMC Health (NMC) 3,022.00p -2.58%
Micro Focus International (MCRO) 2,229.75p -2.12%
International Consolidated Airlines Group SA (CDI) (IAG) 656.40p -1.85%
Standard Chartered (STAN) 821.10p -1.43%
easyJet (EZJ) 1,509.50p -1.31%
Rentokil Initial (RTO) 307.80p -1.03%
Just Eat (JE.) 790.40p -1.00%
HSBC Holdings (HSBA) 784.40p -0.92%
Berkeley Group Holdings (The) (BKG) 4,089.00p -0.87%
3i Group (III) 942.40p -0.86%