London shares closed higher on Thursday led by Britain’s biggest tech deal of the year and an advance by oil prices.
The blue-chip FTSE 100 index closed up 0.18% at 6,858 and was led by tech firm Micro Focus (LON:MCRO), up 14.7% to 2,243p.
As Proactiveinvestors reported on Wednesday, the Micro Focus is to acquire the software unit of Hewlett Packard Enterprise (NYSE:HPE) including the assets of former UK tech champion Autonomy for $8.8bn. Read more.
Micro Focus, which entered the FTSE 100 last week, at one point in the session jumped as high as 21%.
Oil prices helped support the market, with Brent crude up 3.7% to $49.76.
British Airways owner International Consolidated Airlines (LON:IAG) was the second-highest gainer on the FTSE 100 of 4% to 422.1p after a positive broker's note and a hint from chief executive Willie Walsh that other airlines were keen to join the group.
Dixons Carphone (LON:DC.) was the third-highest climber on the FTSE 100, up 4% to 389p. The electrical, phones and household goods retailer said it witnessed “no detectable impact” from the June Brexit vote and posted a 9% year-on-year increase in first quarter group revenue and a 4% like-for-like rise in revenue. Shares added almost 4% to stand at 388.6p.
Education publisher Pearson (LON:PSON) was the biggest faller, dropping 7.7% to 797p, following disappointing results from rival publisher John Wiley, which also provides US college textbooks.
The mid-cap FTSE 250 index also rose, by 0.7% to 18,193 as it continued to put distance with its disappointing performance in the immediate aftermath of the Brexit poll in June.
Tour operator Thomas Cook Group (LON:TCG) was the top gainer of 6.1% to 76.05p after it said it was launching a joint venture with Chinese investor Fosun called Thomas Cook China, which will target "affluent, adventurous, quality-oriented" customers as the pair look to grab a high-margin share of China's fast-expanding holiday market.
A top-three gainer among mid-caps was broker ICAP (LON:IAP) which rose by 5.1% to 497.8p after suitor Tullett Prebon’s (LON:TLPR) purchase of the global broking business of rival ICAP avoided an in-depth UK antitrust investigation after the market watchdog accepted minor concessions proposed by the two interdealer brokers.
The Competition and Markets Authority said on Thursday it was “satisfied” after it received no complaints from rivals and ruled the merger would not be sent for further scrutiny.
Tullett, also a mid-cap name, was in the top-20 risers, up 3.4% to 385.3p.
Among smaller names, the FTSE AIM 100 Index advanced by 1.1% to 3,841 and the FTSE AIM All-Share Index ended up 0.9% to 808.
Across the bourse, 38% of stocks gained, 25% lost and 37% were unchanged.
MID-SESSION
FTSE 100 was hanging onto gains at lunch though the benchmark was lower than earlier as traders await comment from the European Central Bank.
European indices are lower as investors fret over what Mario Draghi will do to continue his battle to improve and bolster the region's economy.
FTSE 100 is up around 20 points at the time of writing, at 6,866; the FTSE AIM All share is 0.67% ahead and the FTSE AIM 100 is 0.69% higher.
Micro Focus International (LON:MCRO) is still top of the Footsie pile as news it agreed a $8.8bn merger with Hewlett Packard’s software business, has really cheered the market.
Micro shares gained a massive near 16% to stand at 2,263p.
Dixons Carphone (LON:DC.) the electrical, phones and household goods retailer posted a 9% year-on-year increase in first quarter group revenue and a 4% like-for-like rise in revenue. Shares added almost 4% to stand at 388.6p.
On the losing front, Pearson (LON:PSON), the publisher, dropped over 5% as it fell along with US peer John Wiley & Sons, whose shares plunged yesterday after it posted first-quarter results.
Adjusted earnings per share fell to $0.52 in the three months ended July 31, from $0.58 a year earlier, missing average analyst consensus.
In the junior company world, drone service company Strat Aero PLC (LON:AERO) has landed a UK deal worth up to £2.5mln for “eye-in-the-sky” environmental survey work, boosting its shares by almost 53% to 0.65p.
OPEN
Riser and Fallers: Including Micro Focus and Strat Aero https://t.co/20fEYxVIZd via @proactive_uk
— Giles Gwinnett (@Gile74) 8 September 2016
FTSE 100 climbed higher at the open, along with European shares, as traders await comments from ECB president Mario Draghi later.
The blue chip index is up 39 points at 6,885. FTSE 250, the more UK centred index is up over 58 points.
In small caps, things were also buoyant. The FTSE AIM All share is up 0.58% to 806.340, while the FTSE AIM 100 is 0.66% higher at 3,823.
Draghi will talk monetary policy and Chris Beauchamp, at IG, notes it is "remarkable to think we are nearing the original end date for the European Central Bank’s QE programme, and yet there has been very little improvement in the eurozone’s overall economic position".
He suggests there will be an extension to the QE programme beyond March 2017.
Top Footsie dog was Micro Focus International (LON:MCRO), which gained over 18% to 2,310p as it unveiled an $8.8bn merger deal with Hewlett Packard's software business.
In small caps, Strat Aero plc (LON:AERO), the drone maker, was getting the plaudits with its shares flying over 70% higher at 0.725p.
It revealed its wholly-owned subsidiary, Geocurve, had been awarded a further contract to provide aerial inspection and level survey services for the Environment Agency's Thames Estuary Asset Management 2100 (TEAM2100) programme.
Futura Medical plc (LON:FUM) was over 52% higher to 98.33p as it continues to bask in the news yesterday that a pivotal clinical trial of its gel for erectile dysfunction (ED) had been a resounding success.
Opening snapshot at 8.15am
The FTSE 100 opened 15 points to the good this morning at 6,862.
The top winner was Dixons Carphone (LON:DC. up 2.5% to 384p after it reported better than expected sales with no 'detectable' impact from Brexit.
The biggest loser was Admiral Group (LON:ADM) down almost 3% to 2,000p.
News
Sound Energy reaches second casing point at latest Tendrara well
Harvest Minerals environmental approval brings fertiliser production closer
Motif Bio plc expects data readout earlier than expected thanks to patient enrolment
Preview at 7.00am
Nintendo’s iconic plumber provided a catalyst for traders in Japan, but here in Europe markets await direction from another Italian named Mario.
In Japan Nintendo shares picked up around 12% on Thursday after the rejuvenated video games group unveiled plans for Mario Run, a smartphone game that it hopes can follow up the unprecedented breakout success of Pokemon GO.
Unlike Pokemon GO, which was developed by Google spin-off Niantic, the new Mario game will be very much a Nintendo game and as such success will equate to much more substantial revenues.
Closer to home, meanwhile, investors wait for European Central Bank president Mario Draghi who will later today update on the Eurozone’s monetary policy.
Not much is anticipated in terms of new initiatives, but, with macroeconomics, stimulus and interest rates all pulling markets in recent months it is little surprise that investors are sitting on their hands ahead of the announcement.
“European equity markets are expected to open relatively flat ahead of the ECB monetary policy announcement on Thursday, with investors appearing to opt for caution despite no new action being anticipated,” said Craig Erlam, analyst at forex specialist OANDA.
“The ECB finds itself between a rock and a hard place at the moment.
“Growth and inflation continues to elude the euro area and we’re likely to find out today, when the central bank releases its latest economic projections, that Brexit has only made that situation more dire, albeit potentially less so at this stage than many would have thought a couple of months ago.”
Wall Street marked an uneventful close on Thursday, although many attentions were fixed on Apple as it launched its latest iPhone iteration – SPOILER ALERT: the new model comes without a headphone jack.
The Dow Jones ended Wednesday just 11 points, 0.06%, lower at 18,526 while the S&P 500 moved even less from its starting point finishing the session t 2,186. The Nasdaq meanwhile edged slightly higher, adding 0.15% to 5,283.
Nintendo was the feature in Japan, rising 12%, whereas the Nikkei index was about 0.4% lower at 16,948.
Hong Kong’s Hang Seng gained 142 points, 0.6%, to 23,886 while the Shanghai Composite was more or less static at 3,092.
Australia’s ASX 200 was in negative territory, losing 47 point or 0.68%, to 5,387.
In London, CFD and spreadbetting group IG Markets sees only a couple of points movement from the blue chip shares. About an hour before the open it is calling the FTSE 100 4 points higher at 6,841 to 6,845.