London open: Mining M&A and earnings give UK markets a boost
UK stocks were back in uncharted territory on Thursday morning, on track for its third record closing high of the week after some profit taking the previous session.
The mood was lifted by M&A activity in the mining sector, after Australian giant BHP Group's takeover proposal for Anglo American that could be worth more than £30bn, along with some well-received results from AstraZeneca and Barclays.
The FTSE 100 was up 0.5% at 8,079.22 by around the 0830 BST mark, hitting an early intraday high of 8,098.14, as it looks set to surpass the current all-time closing high of 8,044.81 reached on Tuesday.
Along with a barrage of corporate earnings in London, there will be yet more quarterly figures from America's tech titans on Thursday, with Google, Microsoft and Intel all due to report today.
Markets gave a negative reaction to seemingly strong results from Meta after the closing bell in New York on Wednesday, as investors continue to question sky-high valuations following the strong performance of tech stocks so far this year.
"So far, we observe that the high expectations have played tricks on stock valuations and the first set of earnings reactions warn that even strong results from Big Tech may not suffice to send their stock prices higher – if we start seeing growth expectations level out (I am looking at you Microsoft and Nvidia)," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
Traders will also be keeping their eyes on economic data on Thursday, with the first reading of US gross domestic product for the first quarter. Consensus is that the economy expanded at a quarterly annualised pace of 2.5%, down on 3.4% at the end of 2023.
Anglo jumps on BHP proposal
Anglo American rose 14% early on after confirming that it had received an unsolicited non-binding and highly conditional all-share takeover proposal from Australia’s BHP Group. Shareholders of the London-listed miner would receive 0.7097 BHP shares for each Anglo share, valuing the company at £31.1bn. Anglo said it was reviewing the proposal.
AstraZeneca was in demand after the drugmaker said first-quarter revenues were up 18% on the back of strong sales of its cancer drugs. Revenues came in at $12.7bn, beating the $11.9bn guidance, lifting shares up 5%.
Barclays was also up 4% despite reporting a 12% fall in first-quarter profit on lower income as customers shopped around for better savings rates and mortgage deals. Pre-tax profit for the first three months of the year fell to £2.2bn from £2.6bn a year earlier and slightly better than its own consensus forecast of £2.195bn.
Among the fallers was grocer Sainsbury despite delivering better-than-expected earnings for the year to 2 March. Underlying pre-tax profit rose 1.6% to £701m, beating Sainsbury's own guidance of £670-700m.
Online ticketing platform Trainline shares were lower on the same day that the Labour Party pledged to renationalise Britain's railways if it is elected. Labour said it would take five years to conclude the plan.
Market Movers
FTSE 100 (UKX) 8,079.22 0.48%
FTSE 250 (MCX) 19,608.71 -0.56%
techMARK (TASX) 4,509.71 0.23%
FTSE 100 - Risers
Anglo American (AAL) 2,507.50p 13.72%
AstraZeneca (AZN) 11,970.00p 5.44%
Unilever (ULVR) 4,027.00p 4.25%
Barclays (BARC) 198.12p 3.65%
Antofagasta (ANTO) 2,224.00p 2.68%
Croda International (CRDA) 4,721.00p 1.44%
Reckitt Benckiser Group (RKT) 4,397.00p 0.53%
Intertek Group (ITRK) 4,976.00p 0.53%
Ashtead Group (AHT) 5,760.00p 0.45%
Standard Chartered (STAN) 682.00p 0.41%
FTSE 100 - Fallers
Legal & General Group (LGEN) 233.70p -5.99%
Rolls-Royce Holdings (RR.) 405.20p -2.83%
St James's Place (STJ) 431.60p -2.79%
Schroders (SDR) 357.20p -2.72%
WPP (WPP) 782.00p -2.71%
Sainsbury (J) (SBRY) 260.80p -2.69%
Rightmove (RMV) 503.40p -2.25%
Frasers Group (FRAS) 778.00p -2.14%
BAE Systems (BA.) 1,336.50p -1.98%
Convatec Group (CTEC) 279.40p -1.96%
FTSE 250 - Risers
Inchcape (INCH) 754.50p 4.94%
Wizz Air Holdings (WIZZ) 2,200.00p 4.07%
TI Fluid Systems (TIFS) 151.20p 2.16%
Assura (AGR) 41.70p 1.96%
Drax Group (DRX) 521.50p 1.56%
Volution Group (FAN) 419.00p 1.21%
Hipgnosis Songs Fund Limited NPV (SONG) 102.40p 0.99%
Bank of Georgia Group (BGEO) 5,240.00p 0.77%
Britvic (BVIC) 866.50p 0.76%
Currys (CURY) 63.30p 0.72%
FTSE 250 - Fallers
Moonpig Group (MOON) 162.80p -8.33%
Indivior (INDV) 1,390.00p -8.19%
WH Smith (SMWH) 1,171.00p -6.92%
Trainline (TRN) 323.80p -5.60%
Bakkavor Group (BAKK) 117.50p -4.47%
Greggs (GRG) 2,680.00p -3.60%
FirstGroup (FGP) 165.10p -3.28%
Tyman (TYMN) 380.50p -3.18%
4Imprint Group (FOUR) 6,130.00p -2.85%
Morgan Sindall Group (MGNS) 2,225.00p -2.84%