FTSE 100 movers: Smurfit surges on bid rejection; Just Eat hit by investment plan
London's FTSE 100 was up 0.8% to 7,170.54 in afternoon trade on Tuesday, with paper and packaging stocks pacing the advance.
Cardboard box maker Smurfit Kappa surged after rejecting an "unsolicited and highly opportunistic" takeover approach from US-based International Paper.
The proposed acquisition would have meant International Paper paying cash and shares for Smurfit, leaving shareholders of the Dublin-based company with a minority stake in the combined business. Peers Mondi and DS Smith also gained ground, with the former getting an added boost from an upgrade to 'outperform' from 'neutral' at Credit Suisse, which said the stock is attractively priced. It noted the shares have basically flat-lined over the last 12 months, while earnings prospects and valuation metrics have improved materially.
Inspection, product testing and certification company Intertek rallied after it posted a jump in full-year pre-tax profit as revenue grew and the company lifted its dividend. Pre-tax profit for 2017 was up 13.3% to £438.8m on revenue of £2.8bn, up 8% on the previous year.
Anglo American was on the rise after saying that sales of rough diamonds at De Beers fell in the second cycle compared to the previous cycle, but were up a touch from the second cycle of last year.
On the downside, Just Eat tumbled as it delivered better full-year results than had been expected, but increased investment in 2018 to cope with intense competition in the online food delivery market meant guidance disappointed like a day-old kebab.
Rental equipment firm Ashtead slumped even as it said reported rental revenue increased 21% to £2.6bn for the nine months to the end of January and underlying pre-tax profit was up by 24% on a constant currency basis to £742m.
Nicholas Hyett, equity analyst at Hargreaves Lansdown, said: "Despite an exceptionally strong performance so far this year, guidance for the full year remains unchanged and that’s a bit disappointing. Management caution seems to be driven by conditions in the foreign exchange markets."
Sainsbury was in the red following the release of surveys from Kantar and Nielsen, both of which found that it was the slowest growing of the big four supermarkets.
Also on Tuesday, the company announced a £100m investment in its staff this year, which will take the base rate of pay to £9.20 an hour from £8.00, but said it was also getting rid of paid breaks and bonuses.
Risers
Smurfit Kappa Group (SKG) 3,068.00p 20.69%
Intertek Group (ITRK) 5,184.00p 6.49%
Smith (DS) (SMDS) 504.20p 5.30%
Anglo American (AAL) 1,765.40p 4.26%
Mondi (MNDI) 1,974.00p 3.57%
Tesco (TSCO) 211.00p 3.43%
BHP Billiton (BLT) 1,480.80p 3.05%
Antofagasta (ANTO) 887.80p 2.90%
Croda International (CRDA) 4,561.00p 2.52%
Old Mutual (OML) 255.30p 2.45%
Fallers
Just Eat (JE.) 760.60p -10.71%
Ashtead Group (AHT) 1,899.00p -6.41%
Sainsbury (J) (SBRY) 245.90p -2.77%
easyJet (EZJ) 1,562.50p -2.19%
WPP (WPP) 1,240.00p -1.59%
British Land Company (BLND) 629.80p -0.82%
Land Securities Group (LAND) 914.00p -0.80%
Taylor Wimpey (TW.) 186.05p -0.77%
Hargreaves Lansdown (HL.) 1,670.00p -0.77%
Barratt Developments (BDEV) 535.30p -0.76%