Market buzz: NEX receives approach from CME, Unilever picks Rotterdam
1748: NEX Group, Icap as was, has confirmed (in an announcement at 1737 GMT) that it has received a preliminary approach by CME Group regarding a potential acquisition of NEX. "Discussions are at an early stage and there can be no certainty that an offer for NEX will be made, nor as to the terms of any offer, if made."
1641: After humming and hawing all day amid a buzz of UK corporate and geopolitical newsflow, London's blue chip stock benchmark has arrested its losing run after three down days. The FTSE 100 ended Thursday just 7.07 points or 0.099% higher at 7,139.76.
Looking at Wall Street, analyst Chris Beauchamp at IG in London said there "seems little sign of concern about global trade wars this afternoon, as the bulls take their turn in the spotlight" with the tariff narrative "becoming less of a worry" amid healthy numbers on the US economy. But this helped perk up the dollar too, which helped the FTSE and meant there was little appetite to hold gold and silver this afternoon.
1614: Purplebricks has been under the cosh later in the session as UBS has calculated that growth is slowing at the online estate agent, while competitor Yopa is making progress. The Swiss bank's property listings tracker signals that growth has slowed for Purplebricks, which it rated at 'sell'.
1600: The US Treasury has imposed sanctions on 19 Russians who it accuses of involvement in interference in the 2016 US presidential race and other "ongoing nefarious attacks". Treasury secretary Steve Mnuchin says: "These targeted sanctions are a part of a broader effort to address the ongoing nefarious attacks emanating from Russia."
1345: Some more on the Unilever decision to pick Rotterdam over London for its corporate HQ.
Paul Polman, Unilever's chief executive, said the decision was taken for technical reasons and that it had nothing to do with Britain's decision to leave the EU. Critics of Brexit have said a decision in favour of Rotterdam would indicate Britain's weakened position outside the EU.
Polman told the BBC: "This is not about Brexit. Unilever is in 190 countries and most of these countries are not in the European Union. Both countries (the Netherlands and the UK) are very attractive from an investment point of view. We have a long history here that we are proud of and we are happy we can continue to build on that."
1302: GKN's largest customer, Airbus, has suggested it would withdraw custom from the FTSE 100 engineer in the event of the proposed hostile takeover by Melrose International.
Analysts at Olivetree Financial yesterday calculated that Melrose’s ability to attain a 50% acceptance from GKN investors "isn’t necessarily the slam-dunk that a decent swathe of the market currently assumes".
1255: We've had a barrage of US data. Initial jobless claims fell by 4,000 to 226,000 from the previous week's level, which was revised down by 1,000.
The Empire State survey's headline index of general business conditions rose from a reading of 13.1 points for February to 22.5 in March.
US import prices rose at a slower pace than expected last month, amid a decline in the cost of fuel imports and downwards revisions to data for the previous months. The US import price index advanced at a 0.4% month-on-month pace in February, according to the Bureau of Labor Statistics, with the year-on-year rate of gains printing at 3.5% in February.
1212: The London midday report shows stocks had pared earlier gains by midday on Thursday amid worries about a possible trade war between the US and China, while news that Unilever is shunning the UK for new headquarters in Rotterdam did little to boost sentiment. The FTSE 100 was up 0.1% to 7,140.59, having been up 0.2% earlier.
1138: Goldman Sachs has cut ciggy maker Imperial Brands to 'neutral' from 'buy' and cut its 12-month price target to 2,760p from 3,610p as it removed the stock from its Pan-Europe 'conviction list' as its thesis.
1101: Tesco is a visible turnaround story and the retailer will increasingly be viewed as a capital return stock, JP Morgan analysts said as they rated the shares ‘overweight’.
1010: The Government has been signing secret agreements with companies and industry groups over highly controversial outcomes of the Brexit process for Britain's trade border, according to Sky News.
0950: Russian foreign minister Sergei Lavrov will soon kick out 23 British diplomats in retaliation for the UK's expulsion of 23 Russian diplomats, state news agency RIA is reporting.
Asked about any potential move by Britain to cut its gas imports from Russia, with Gazprom sending over around a fifth of UK's gas consumption last year, energy minister Alexander Novak it would be "politically motivated".
The pound, having been up 0.1% earlier is now down 0.14% against the dollar at 1.3943.
0931: BT has announced the largest recruitment drive in Openreach’s history as the infrastructure arm it looks to expand ‘full-fibre’ throughout the UK, with eight UK cities connected with ultrafast full-fibre broadband throughout 2018.
0906: How about some oil news? The International Energy Agency has just lifted its 2018 global oil demand growth forecast. The IEA expects demand to increase by 1.5m barrels a day in 2018 to 99.3m b/d, up 100k b/d from its prediction last month. Higher demand and declines in Venezuela's output could push market into deficit from the second quarter of 2108.
But Donald Trump's new protectionist measures and retaliation from China, Europe and elsewhere could hit economic growth forecasts and therefore oil demand, the agency said. “A slowdown would have strong consequences, particularly for fuel used in the maritime sector and in the trucking industry.”
0839: Shares in PZ Cussons, the soaps and shower gels maker, are down 24% after it issued a profit warning amid tough trading conditions.
The FTSE 250 company had reported in January that performance in the first half of the year was constrained by conditions in the UK and Nigeria, and that delivery of the full year result would be dependent on conditions in those markets for the balance of year. Today it said it was now apparent that profit for the full year would fall short of expectations.
0834: Barclays had an initiation note on the major UK banks (just noticed this was from yesterday), with a new top pick of Lloyds and for RBS "as we expect UK net interest margins to beat a pessimistic consensus and our earnings estimates are 10%+ ahead of the Street".
0815: London stocks have stepped higher in initial minutes of trading on Thursday, with the FTSE 100 up 12.15 points or 0.17% to 7,144.84 and the 250 moderately higher too.
The pound is climbing amid some encouraging Brexit news. Brexit Secretary David Davis will go to Brussels on Sunday in what looks like an indication that a deal is imminent, says Bloomerg. While the Times has seen documents that indicate the UK will be free to sign trade deals during the transition period without permission from the European Union after a climbdown by Brussels. "EU negotiators have accepted the UK’s demand that it should be able to pursue an independent trade policy while remaining inside the customs union and single market."
Overnight, Wall Street finished lower following the release of data revealing a third consecutive month of falling retail sales, with some investors concerned by a looming trade war and White House hiring and firing.
0756: Glencore has reportedly agreed a three-year deal to sell around a third of its forecast cobalt production to China’s battery manufacturer GEM Co, notes analyst Yuen Low at Shore Capital. The FTSE 100 commodities giant will produce 39kt of cobalt in hydroxide in 2018 (around 35% of forecast global production), 65kt in 2019, and 63kt in 2020. The agreement with GEM is for 13.8kt in 2018, 18kt in 2019 and 21kt in 2020.
"Pricing, which has previously been reported in the press as a 'sticking point', has not been disclosed," Low says. "That said, Glencore CEO Ivan Glasenberg had previously indicated that it would not agree any fixed price deals, in order to benefit from price increases."
With car, battery and other manufacturers all known to be keen to pin down deals on supplies, Low pointed out that most incremental supply over the next decade appears likely to be in the form of ferronickel or nickel pig iron (NPI), which are not suitable for the battery market. He says fully listed Anglo Pacific has recognised this new reality as it entered into a ‘growth’ royalty agreement with privately-held Brazilian Nickel, whereby the UK firm will provide up to c.US$70m of construction funding in return for gross revenue royalties of up to 5.5%.
0722: Unilever has announced it will base its corporate headquarters to Rotterdam from London as it combines its two classes of shares into a single entity. The Anglo-Dutch giant said the move was designed to simplify its corporate structure and strengthen corporate governance.
Housebuilder Persimmon has announced the appointment of Roger Devlin as chairman from June.
0706: Concerns over an all-out trade war with China escalated on Wednesday, resulting in another day of losses on Wall Street, notes market analyst Jasper Lawler at London Capital Group. "Investors are growing increasingly nervous as Trump rebuilds a White House team which is more in line with his interventionist approach to foreign policy and as reports surfaced that Trump is looking to put $60 billion of tariffs in imported goods from China, no longer just steel and aluminium. This is expected to be the last straw for China, with retaliation to this latest move almost a given."
LCG's opening calls are for the FTSE to open four points higher at 7136, the DAX to open 41 points higher at 12279 and the CAC 40 to open 18 points higher at 5251.