MARKET CLOSE
London shares built on gains on Wednesday and finished 1.49% higher at 6,229, with SABMiller (LON:SAB) the standout riser, as the Fed's policy meeting began across the Pond and all eyes are on whether there is a rise or not.
SABMiller said it was facing a potential takeover bid from rival Anheuser-Busch InBev and shares rose almost 20% higher, to 3,164p while AB Inbev's stock was also lifted.
There had been speculation that SABMiller could mount a defence against AB Inbev by launching its own takeover bid for a rival, possibly Diageo (LON:DGE).
Talk is also doing the rounds that US activist investors could buy Diageo, the maker of Johnnie Walker whisky and Guinness, and break it up.
Also, positive news on jobs helped give sterling a boost. Employment rose by 42,000 in the three months to July to 31.095 million. But claimant count unemployment edged up by 1,200 in August from July’s record low of 71,900.
Howard Archer at IHS Global Insight said: "The labour market has clearly lost momentum compared to earlier this year."
Turning to the US Federal Reserve's eagerly awaited rate decision tomorrow, Chris Beauchamp at IG said the M&A activity helped to distract everyone from the FOMC and provide relief from a dreary day in London.
Accendo Markets said jitters about a hike appeared to have receded.
Mining and commodity giant Glencore (LON:GLEN) added 5.19% to 134.7p after successfully placing £1.6bn of shares to shore up its balance sheet.
Pan African Resources (LON:PAF) dropped 4.11% to 7p as it forecast an improvement after a tough year. Broker WH Ireland agreed, raising its recommendation on the gold miner from 'underperform' to 'speculative buy'.
Shares in Galantas Gold (LON:GAL) rose 13.16% to 5.375p after the discovery of high grade gold on the boundary of the Omagh Gold Mine, County Tyrone, Northern Ireland.
Lower oil prices and write-offs for its holding in Lansdowne Oil & Gas (LON:LOGP) took a toll on Sea Energy’s first half.
SeaEnergy’s main business is software that generates models of oil rigs and other facilities to aid maintenance, but as the crude price has fallen oil companies have cut back on spending.
There are signs the market is picking up again and the company expects to return to profitability in 2016, but SeaEnergy now expects an operating loss for 2015. Shares in the firm eased around 22% to 5.75p.
London shares built on gains on Wednesday amid drink industry takeover activity and a positive overnight session in Asia.
The FTSE 100 Index fizzed 66.72 points to 6204 after SABMiller (LON:SAB) said it was facing a potential takeover bid from rival Anheuser-Busch InBev.
SABMiller's shares rose 629.5p to 3644p while AB Inbev's stock lifted €8.4 to €102.85 in Brussels.
There had been speculation that SABMiller could mount a defence against AB Inbev by launching its own takeover bid for a rival, possibly Diageo (LON:DGE).
Talk is also doing the rounds that US activist investors could buy Diageo, the maker of Johnnie Walker whisky and Guinness, and break it up.
In Asia-Pacific, Japan’s Nikkei gained 145 points, helped by a weaker USD/JPY however underperforming peers amid thin volume as investors brace for tomorrow’s Fed decision.
China had a late bounceback after Tuesday’s heavy losses, helping Hong Kong’s Hang Seng to outperform.
In the UK, positive news on jobs helped give sterling a boost. Employment rose by 42,000 in the three months to July to 31.095 million. But claimant count unemployment edged up by 1,200 in August from July’s record low of 71,900.
Howard Archer at IHS Global Insight said: "The labour market has clearly lost momentum compared to earlier this year."
Turning to the US Federal Reserve's eagerly awaited rate decision on Thursday, Accendo Markets said jitters about a hike appeared to have receded.
Back on the corporate front, upmarket fashion group Burberry (LON:BRBY) got a boost from the Chinese market bounce, advancing 8p to 1413p.
Mining and commodity group Glencore (LON:GLEN) pared losses to stand 1.1p up at 129.15p after successfully placing £1.6bn of shares to shore up its balance sheet.
Pan African Resources (LON:PAF) dropped 0.5p to 7.25p as it forecasted an improvement after a tough year. Broker WH Ireland agreed, raising its recommendation on the gold miner from 'underperform' to 'speculative buy'.
Antimony explorer Tri-Star Resources (LON:TSTR) strengthened 0.01p to 0.14p after securing funding to start building an antimony processing plant in Oman.
Shares in Galantas Gold (LON:GAL) spiked 0.62p to 5.38p after the discovery of high grade gold on the boundary of the Omagh Gold Mine, County Tyrone, Northern Ireland.
MARKET PREVIEW
London’s blue chips are set for early gains after almost all major markets registered rises overnight.
Financial spread bet firms sees the Footsie adding more than 20 points when trading gets underway, after gains of 53 points yesterday to 6,138.
US and Asian markets were also higher ahead of the Federal Reserve’s key meeting today’
A decision on whether US interest rates will rise will not be known until tomorrow evening, but the debate recently has been swinging towards no change given the turbulence in China.
Dow Jones rose 229 points to 16,600, with Nasdaq and the S&P 500 both up by more than 1%.
Company news saw Microsoft raise its dividend by 16%, while Hewlett-Packard announced plans to cut 30,000 jobs. The axe is falling mainly on its enterprise side. The cost will be US$2.7bn.
Asian markets followed the US higher with big gains in Hong Kong and Tokyo, though Shanghai was coming back towards the end of the day.
UK company news will be dominated by the launch of mining titan Glencore’s well-flagged US$2.5bn fund raising.
Investors will also be keen to see what graphics game chips designer Imagination Technologies has to say about the new range of Apple products.
IN THE PAPERS
Glencore has pushed the button on its US$2.5bn capital-raising after another rollercoaster day for its shares.
The heavily indebted miner and commodities trader said last night that it would place up to 1.3bn new shares, or almost 10% of its share capital, the Times reports.
The Independent reports that Swiss commodities companies have been accused of depriving the people of Burkina Faso of millions of pounds a year in tax for the gold being dug out of the impoverished country’s mines.
The Berne Declaration NGO claims to have traced the true origins of gold being processed in Switzerland.
The Times continues to report on the row over whether the Treasury interfered in sensitive forecasts by the government’s top economic watchdog.
Senior MPs demanded that private emails be made public, says the paper, after it revealed officials sought to meddle with the independence of the Office for Budget Responsibility.
Ocado has warned that supermarket chain Morrisons would be unable to start its own internet operation because it was tied to a 25-year deal to sell food online through Ocado’s online service.
Duncan Tatton-Brown, Ocado’s finance director, said: “Ocado is the exclusive provider of online grocery services for Morrisons. Those are the terms of the deal for the remaining 23 years," writes the Guardian.
UK motor insurer Hastings Direct has unveiled plans to list on the London Stock Exchange and raise £180mln in the process.
The company is majority owned by US investment bank Goldman Sachs and the listing value could top as much as £1.5bn.
Hewlett-Packard disclosed it plans to slash another 25,000 to 30,000 jobs to put its new enterprise business on a stronger footing as a standalone company, the FT and other papers report.
The swingeing cuts come on top of 54,000 jobs that have already gone over the past three years as part of chief executive Meg Whitman’s turnaround strategy.
The Times adds the move comes as it prepares to split into two separate companies and will cost US$2.7bn.