FTSE 100 Live Monday
- Qualcomm strikes £1.8bn takeover
- WPP boss to step down
- Frasers targets beauty firm
Market update: FTSE 100 steady amid trade talks, WPP falls on CEO exit
09:55 , Greaeme EvansHopes of a record push by the FTSE 100 index faded today amid the uncertainty of US-China trade talks and prospect of key economic releases later this week.
Having started the week 34 points off its all-time high close of 8871.31, London’s top flight drifted 2.21 points to 8835.70.
The biggest downward move was by WPP after Mark Read announced he is to step down as chief executive of the UK’s largest advertising firm.
WPP shares dipped 2% or 11.4p to 547.4p, moving them closer to the five-year-low struck in April and adding to a decline of more than 30% so far this year.
Read has been at the Ogilvy agency owner for 30 years, with seven of those as chief executive after replacing long-time boss Martin Sorrell.
Susannah Streeter, Hargreaves Lansdown head of markets, said: “It’s been far from an easy ride during his tenure, with revenue declining 1% last year and set to be super-sluggish this year.
“WPP is now facing a more formidable foe in French rival Publicis, which has now overtaken the British company as the world’s largest agency group.”
Other FTSE 100 fallers came from the defence and aerospace sector as BAE Systems and Rolls-Royce gave up some of their recent progress with declines of 8.5p to 1922p and 10.8p to 874.2p respectively.
Babcock International also weakened 9p to 1048p and GKN Aerospace owner Melrose Industries slipped 6.5p to 461.3p.
Wider stock market sentiment was impacted by the start of China-US trade negotiations in London, as well as this week’s release of US inflation figures, UK unemployment and GDP and the Chancellor’s spending review.
The best performing stock in the FTSE 100 index was asset manager M&G, which rose 4p to 247.8p after UBS switched to a Buy stance with a 275p price target.
The FTSE 250 index rose 3.82 points to 21,161.10, with Mitie Group showing signs of recovery after last week’s heavy results-day fall. The facilities management firm rose 3% or 3.6p to 139.8p.
Elsewhere, the shares of Alphawave IP jumped 23% or 34.8p to 184p after the semiconductor firm’s board backed a £1.8 billion takeover by Qualcomm.
Anglo-Canadian Alphawave listed in London in May 2021 when it sold £856 million of shares in an IPO valuing it at £3.1 billion.
WPP shares fall on CEO exit, M&G leads FTSE 100
08:40 , Graeme EvansThe FTSE 100 index is unchanged at 8837.73, with WPP down 11.2p to 547.6p after the advertising group announced that chief executive Mark Read is to stand down.
WPP was joined by BAE Systems, Rolls-Royce and Melrose Industries during a second successive poor session for the defence and aerospace sector.
M&G led the top flight, up 3.6p to 247.4p after UBS backed the savings and investment firm with a Buy recommendation and new price target of 275p.
Legal & General also rose 1.9p to 258p and Glencore lifted 2.3p to 290.4p.
The FTSE 250 index slipped 20.20 points to 21,137.08.
Revolution Beauty confirms Frasers takeover interest
08:11 , Graeme EvansMike Ashley’s Frasers Group is considering a takeover of Revolution Beauty, the troubled beauty retailer has said.
Revolution told shareholders that Frasers – which owns Sports Direct and Flannels – “is one of a number of parties conducting due diligence” on the business.
It comes after Revolution formally put itself up for sale last month after being approached by an unnamed suitor.
“There can be no certainty that Frasers’ interest will result in a firm offer for the company,” Revolution said in a statement.
Alphawave IP agrees Qualcomm takeover
08:01 , Graeme EvansSemiconductor group Alphawave IP today agreed a £1.8 billion takeover from US chip giant Qualcomm.
The Gresham Street headquartered company told shareholders this morning it had finally struck a deal with its suitor after an extension for the takeover deadline was extended for the fifth time last week.
Anglo-Canadian Alphawave listed in London in May 2021, when it sold £856 million of shares in an IPO valuing it at £3.1 billion.
Week ahead: US inflation and UK labour market figures due
07:43 , Graeme EvansWednesday’s US inflation data will be a key event for global markets this week, with the annual rate set to show an increase to 2.5% from April’s 2.3%.
IG said this morning: “Markets remain delicately balanced between trade optimism and broader macro and political uncertainties.”
The Chancellor’s long-awaited spending review on Wednesday will be the main focus in the UK, alongside unemployment and GDP updates.
Tuesday’s labour market figures are forecast to show an increase in the unemployment rate to 4.6% alongside unchanged growth in total wages of 5.5%.
GDP figures due on Thursday are set to point to a moderation of the UK economy after the robust first quarter, with output seen 0.1% lower in April.
WPP chief executive to step down
07:06 , Graeme EvansMarketing and advertising group WPP today announced that chief executive Mark Read is to step down at the end of the year.
He has spent 30 years with the company, including seven in his current role.
WPP said: “Mark has decided that the time is right for him to hand over to a new leader and the search for a successor is underway.”
The move comes with WPP shares trading more than 30% lower this year.
The FTSE 100-listed group is home to companies including Ogilvy and Burson.
Board chair Philip Jansen said: “Mark has played a central role in transforming the company into a world leader in modern marketing services, with deep AI, data and technology capabilities, global presence and unrivalled creative talent, setting WPP up well for longer-term success.”
FTSE 100 opens near record, Asia stocks higher
07:00 , Graeme EvansThe FTSE 100 index starts the week 34 points off its record close of 8871.31 after adding 0.3% in Friday’s session.
The latest improvement followed robust labour market figures in the US, which helped Wall Street benchmarks advance by about 1%.
IG Index futures are pointing to a flat start to the session as attention turns to today’s US-China trade negotiations in London.
Asia markets are stronger, with the Nikkei 225 up 0.9% and the Hang Seng index 1% higher.
China’s latest inflation figures for May showed a third consecutive year-on-year decline of 0.1%, slightly better than the 0.2% forecast.
Deutsche Bank said: “This trend might suggest that Beijing's stimulus measures have not yet been sufficient to enhance domestic consumption amid ongoing trade tensions. Furthermore, deflationary pressures are intensifying on some measures.”
