Weekly review

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Sharecast News | 19 Oct, 2018

The FTSE 100 ended the week 53.89 points higher at 7,049.80.

Equity view

Convenience food manufacturer Greencore Group has struck a deal to sell its entire US business for $1.1bn (£817m) and return a chunk of the cash to shareholders.

Patisserie Valerie’s under-pressure chief executive Paul May quit the board of The Restaurant Group on Monday.

Riverstone Energy announced a tender offer for up to £55m in value of the company's ordinary shares on Monday, to be acquired at a single strike price in a range between £12.00 and £13.75 per share, to be determined on the basis of tenders received.

Mondi announced on Monday that, having recently obtained the necessary permitting, it was now proceeding with the investment in a new 300,000 tonne-per-annum kraft top white machine at Ruzomberok in Slovakia, with start-up expected towards the end of 2020.

Caledonia Investments on Monday spent £117.2m for a 98.9% stake in Deep Sea Electronics in a transaction that values the business at £162.0m.

Rio Tinto reported on Tuesday that it produced plenty of copper in the third quarter, with iron ore production down slightly ahead of a final decision on the feasibility of the Koodaideri iron ore project in Western Australia expected by the end of the year.

Paddy Power Betfair has been fined £2.2m by the Gambling Commission for failing to protect customers with signs of problem gambling and for failing to stop stolen money being gambled.

AstraZeneca, alongside Merck & Co, announced on Tuesday that the two parties have been granted orphan drug designation (ODD) by the US Food and Drug Administration for Lynparza (olaparib) for the treatment of pancreatic cancer.

BHP on Tuesday said it had spent £45.6m to lift its stake in SolGold, which owns the Cascabel copper-gold project in Ecuador.

Royal Dutch Shell on Wednesday reached an agreement to dispose of its Danish oil fields through the sale of wholly-owned subsidiary Shell Olie-og Gasudvinding Danmark (SOGU) for $1.9bn.

Supermarket chain Wm Morrison reported that it has shaken up its senior management team, including widening the role of chief financial officer to include commercial activities.

Pearson's revenue declined in the third quarter as US higher education remained weak but the education and testing group remained on track to hit full year profit targets, with earnings receiving a large one-off tax boost.

Sales of Barratt Developments homes in the first 15 weeks of its financial year have slowed slightly compared to last year but the builder said market conditions "remain good".

Unilever reported an acceleration in underlying sales growth for the third quarter as the consumer goods colossus was able to nudge up prices while still expanding volumes.

Third quarter ongoing revenue at pest control group Rentokil increased by 11.8% to £637.4m at constant exchange rates, as the UK competition regulator flagged concerns about its purchase of Cannon Hygiene.

GVC Holdings' revenues growth accelerated in the third quarter of its financial year as the owner of bookmaker Ladbrokes and various online gaming brands gained market share in all major territories.

Rare disease-focussed biotechnology company Shire announced on Friday that the European Medicines Agency's Committee for Medicinal Products for Human Use (CHMP) has adopted a positive opinion recommending the granting of marketing authorisation of ‘lanadelumab’ injection, for the routine prevention of recurrent attacks of hereditary angioedema (HAE) in patients aged 12 years and older.

Shopping centre owner Intu on Friday confirmed it had received an approach from a consortium led by one of its senior directors to buy the company at 210p a share, valuing it at £2.8bn.

Evraz updated the market on its investment programme on Friday, as investors gathered for the company’s investor day in London.

Shares in InterContinental Hotels fell to a 12-month low on Friday despite booking its best quarter for news signings and openings in a decade, as revenue per available room (revpar) growth slowed.

London Stock Exchange Group updated the market on its third quarter trading on Friday, reporting growth across the group in the three months ended 30 September.

Safety, health and environmental technology group Halma on Friday said it had bought Belgian fire systems company Limotec for €9.3m (£8.2m) on a cash and debt free basis.

Economic news

Theresa May on Monday reassured Parliament that a Brexit deal is still "achievable" despite outstanding differences with the European Union and claims a broad agreement on the structure of the final relationship had already been secured.

Meanwhile, The Bank of England and the Financial Conduct Authority have called on the City to better manage the financial risks of climate change.

On Tuesday, the Prime Minister attempted to quell government in-fighting and rally her colleagues behind her ahead of a crucial European Union summit on Wednesday.

The IFS said that the Chancellor will need to borrow an additional £19bn a year by 2022-23 to try to balance the books and meet the Prime Minister’s claim that the government would “end austerity”.

The UK Prime Minister addressed EU leaders at a crucial Brexit summit in Brussels on Wednesday, urging them to keep the door open to negotiations and give ground on the Irish border issue.

The Office for National Statistics said inflation unexpectedly eased in September, providing relief for under-pressure consumers and significantly reducing the prospect of an imminent interest rate hike.

On Thursday Theresa May said she is open to negotiating a longer Brexit transition period to allow more time to agree to a solution with the EU about the Irish border, with a feared potential cost of £12bn to £15bn.

A bumper summer of consumer spending came to an end with lower retail sales than expected last month, with UK food sales suffering their biggest fall for nearly three years.

MPs from the Business Select Committee on Friday urged the government to bring forward the ban on petrol and diesel car sales by eight years to 2032 to avoid the UK falling behind in the global switch to electric cars.

The UK plastics recycling industry is under investigation for fraud and corruption, with the Environment Agency accusing companies of abusing the exports system and of leaving waste to leak into rivers and oceans.

International events

US President Donald Trump acknowledged that climate change was not a hoax and said he does not consider ongoing trade tensions with China a "war", during a televised interview.

Monday reports stated that the US consumer reined in spending sharply last month and economists believed a further slowdown was on the cards.

Saudi Arabia could "weaponise" its dominance of the oil market if it is hit with sanction by the US government over the missing Saudi journalist Jamal Khashoggi, analysts suggested on Tuesday amid a wobble in oil prices.

German economic sentiment tumbled in October amid worries about trade tensions between the US and China and the potential for a hard Brexit, according to the latest survey from the ZEW Center for European Economic Research in Mannheim.

US Secretary of Commerce Wilbur Ross claimed that trade talks with China had been put on pause on Wednesday, but denied that the two parties had reached an impasse.

Meanwhile, US crude oil stockpiles pushed above their five-year average last week helped by a jump in net imports.

The European Commission sent a letter to Rome on Thursday, querying authorities about the assumptions for economic growth underlying their budget proposals.

US President Donald Trump on Thursday fired the latest salvo in his increasingly bitter trade war with China by announcing plans to pull out of the United Nation’s Universal Postal Union.

Reports on Friday stated that China's economy grew at its slowest rate since the financial crisis, as Beijing's policy loosening has yet to stop the deceleration of investment, consumption and industrial production.

Italian bonds rallied at the end of the week after the European Union's economy chief, Pierre Moscovici, called for a calm dialogue with Rome.

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