Close Brothers is leading the mid-cap index higher after the merchant bank produced better than expected first half figures.
Profits rose to £62.5m, down slightly on last year but higher than City estimates, helped by a strong performance from its broking group Winterflood Securities. However it warned that business had become quieter at the start of the second half as retail investors held back ahead of the election, a trend which its rivals must also be experiencing.
Nevertheless Close Brothers' shares have jumped 45p to 760p and Collins Stewart analysts said:
The interims are encouraging. The first half profit of £62.5m was 12% above consensus of £56m: we expected £63m. Shareholders should be pleased. Apart from the net asset value of 507p a share being 7p above our expectations these results are in line with our expectations. We maintain our earnings forecasts, our 1000p price target and buy recommendation.
Elsewhere in the FTSE 250, transport group Arriva has added 4p to 571.5p as traders heard talk of a possible 700p a share bid. The company recent broker off talks to merge its business with the Keolis transport unit of France's SNCF.
On the other hand, pubs group JD Wetherspoon is 21p lower at 504.5p. HSBC has cut its rating from neutral to underweight and its target price from 545p to 525p. The bank said:
Current trading is weak with like for like sales down 0.4%. However extended hours/breakfast could provide some medium term upside. It remains the most expensive pub stock in the sector.
