- FTSE 100 at highest since March 6th
- UK GDP picks up, economic sentiment rises
- Serco plummets after profit warning
- Shire gains on potential takeover from Allergan
techMARK 2,805.40 +1.25%
FTSE 100 6,745.78 +0.68%
FTSE 250 15,903.02 +0.49%
A decent improvement in UK economic data and continued bid speculation in the pharmaceutical sector gave the City a boost on Tuesday, sending stocks to levels not seen in nearly eight weeks.
Markets were also tracking a late rebound on Wall Street on Monday night owing to easing tensions between Russia and the West.
The FTSE 100 was up 0.7% at 6,746 by midday; the index has not closed above this level since March 6th.
UK economic growth picked up to 0.8% in the first quarter of 2014 after a 0.7% expansion in the fourth quarter of 2013. While this was slightly under the consensus forecast, it marked the fifth consecutive period of growth in the UK, the longest positive streak since the financial crisis.
Martin Beck, Senior Economic Adviser to the EY ITEM Club said that there is potential for growth estimates to be revised higher at a later date. "So we are sticking to our view that the economy will expand by 2.9% in 2014 as a whole, with GDP overtaking its pre-crisis peak in the next quarter. A shift from economic recovery to expansion shouldn't be too long coming," he said.
In other news, the UK economic sentiment index rose in April to 119.5, from a reading of 112.8 the month before, the European Commission said.
The US and EU yesterday unveiled new sanctions against certain Russian officials in President Vladimir Putin's 'inner circle' and corporations linked to them.
However, sentiment was lifted this morning after Moscow assured Washington that it will not invade Ukraine amid reports of Russian troops leaving the border and returning to their bases.
Russian Deputy Foreign Minister Sergei Ryabkov reportedly said that so-called "Crimean scenario" will not be repeated in south-eastern Ukraine.
Serco plummets, bid speculation drives pharma stocks
FTSE-250 support services firm Serco dropped sharply after issuing a fresh profit warning and indicating it may have to raise capital through a share placing just days before new Chief Executive Rupert Soames takes up his role.
Continued M&A activity in the pharmaceutical sector gave stocks a lift this morning with Shire rising strongly on rumours that Botox maker Allergan is still interested in buying the Dublin-based group after initial takeover talks fell apart last month.
AstraZeneca surged nearly 15% yesterday after Pfizer said it was still interested despite the Anglo-Swedish firm knocking back an initial 4,661p-a-share (£60bn) approach. The stock erased early losses this morning after Panmure Gordon upgraded its rating from 'hold' to 'buy', saying that a bid of 5,300-5,400p a share "may tempt AstraZeneca shareholders".
Premier Inn and Costa owner Whitbread rose as it beat forecasts with strong annual growth across the board and hiked its dividend, adding that it has made a strong start to the new year.
Data centre group Telecity jumped after hailing a "good a start to 2014" and keeping its full-year guidance.
UK housebuilder Redrow gained after saying it expects "further good progress" this year, helped by an improved economic outlook and measures by the government to stimulate the housing market.
Wolfson Microelectronics soared after agreeing to a £291m cash takeover offer from Texas-based semiconductor group Cirrus Logic.
Mining stocks were trading slightly lower this as metals prices weakened. Analysts at HSBC downgraded their ratings for BHP Billiton, Antofagasta and Anglo American to 'neutral' today.
FTSE 100 - Risers
Shire Plc (SHP) 3,407.00p +3.68%
BG Group (BG.) 1,178.50p +2.84%
Hargreaves Lansdown (HL.) 1,182.00p +2.69%
easyJet (EZJ) 1,666.00p +2.33%
Legal & General Group (LGEN) 210.40p +1.99%
Smiths Group (SMIN) 1,315.00p +1.94%
Associated British Foods (ABF) 2,950.00p +1.76%
HSBC Holdings (HSBA) 610.30p +1.56%
Sage Group (SGE) 424.50p +1.48%
Royal Mail (RMG) 518.50p +1.37%
FTSE 100 - Fallers
Fresnillo (FRES) 844.00p -2.37%
Randgold Resources Ltd. (RRS) 4,670.00p -1.10%
Travis Perkins (TPK) 1,726.00p -1.03%
Antofagasta (ANTO) 780.50p -0.89%
RSA Insurance Group (RSA) 96.30p -0.57%
William Hill (WMH) 346.30p -0.52%
Capita (CPI) 1,059.00p -0.28%
Glencore Xstrata (GLEN) 311.95p -0.19%
G4S (GFS) 238.50p -0.17%
Intertek Group (ITRK) 2,918.00p -0.14%
FTSE 250 - Risers
Telecity Group (TCY) 720.00p +13.56%
Dechra Pharmaceuticals (DPH) 699.00p +4.48%
UBM (UBM) 676.50p +3.60%
NMC Health (NMC) 468.10p +3.56%
Euromoney Institutional Investor (ERM) 1,127.00p +3.39%
Aveva Group (AVV) 1,955.00p +3.17%
Diploma (DPLM) 683.00p +3.02%
Cable & Wireless Communications (CWC) 53.00p +2.91%
Redrow (RDW) 286.10p +2.73%
Ophir Energy (OPHR) 248.00p +2.73%
FTSE 250 - Fallers
Serco Group (SRP) 320.00p -20.89%
Inmarsat (ISAT) 727.50p -4.78%
Heritage Oil (HOIL) 255.00p -3.04%
UK Commercial Property Trust (UKCM) 81.05p -1.88%
Drax Group (DRX) 657.50p -1.87%
Telecom Plus (TEP) 1,529.00p -1.67%
Foxtons Group (FOXT) 315.20p -1.56%
BH Global Ltd. USD Shares (BHGU) 11.73 -1.18%
AL Noor Hospitals Group (ANH) 1,017.00p -1.17%
Bodycote (BOY) 741.50p -1.07%