LONDON (Alliance News) - Stocks in London are set to edge higher at the open on Friday, amid a thin economic calendar, with the FTSE 100 looking to end the week firmly in the green.
This would mark the seventh consecutive weekly gain for London's blue-chip index.
In early UK company news on Friday, ZPG has agreed to be bought by private equity in a GBP2.2 billion takeover offer; AstraZeneca said the GALATHEA Phase III trial for Fasenra did not meet its primary endpoint; and Interserve has been referred to the Enforcement Division of the UK Financial Conduct Authority due to its handling of inside information.
IG says futures indicate the FTSE 100 index of large-caps to open 3.53 points higher at 7,704.50 on Friday. The FTSE 100 index closed up 0.5%, or 38.45 points at 7,700.97 on Thursday, rising above the 7,700 mark for the first time since late January.
Gains for the FTSE 100 this week have come as Brent oil continues to trade around its best levels since late 2014 on supply fears, after US President Donald Trump's decision on Tuesday to withdraw from the Iran nuclear deal.
A barrel was quoted at USD77.27 early Friday, up from USD77.08 late Thursday.
"After the packed UK economic calendar on Thursday, Friday is in danger of looking a little dull. There is no influential UK data for pound traders to digest, which given the recent spout of dire data, could be a good thing. GBP/USD has clawed its way back after a sharp BoE inspired sell off and it currently targeting USD1.3550," says Jasper Lawler, head of research at London Capital Group.
Sterling was quoted at USD1.3520 early Friday, higher than USD1.3476 at the London equities close on Thursday following the Bank of England's latest interest rate decision and inflation report.
The UK central bank on Thursday decided to keep its key interest rate and quantitative easing unchanged and downgraded its near-term growth outlook.
The economy is projected to grow 1.4% by the second quarter of 2018 instead of 1.8% estimated in February. Growth is seen at 1.7% each in the next three years.
On Friday, Zoopla property portal owner ZPG said it has agreed to a GBP2.2 billion takeover offer from Zephyr Bidco, a wholly-owned indirect subsidiary of funds managed by Silver Lake Management Co V.
Silver Lake is an private equity investor focused on "technology and technology-enabled businesses", with around USD39 billion in assets under management.
The offer values each ZPG share at 490 pence, to be paid in cash, which is a 43% premium to ZPG's volume weighted average share price of 343.0p for the three month period ended Thursday.
It is also a 31% premium to ZPG's closing price of 375.20p on Thursday, which had given the FTSE 250-listed company a market capitalisation of GBP1.65 billion.
Zephyr Bidco said it has received an irrevocable undertaking from Daily Mail & General Trust - ZPG's largest shareholder, holding a 29.87% stake - to vote in favour of the deal. DMGT has held a stake in ZPG since 2012, when DMGT's online property business, the Digital Property Group, merged with Zoopla.
The directors of ZPG intend to recommend unanimously that shareholders vote in favour of the takeover. Zephyr Bidco has so far received irrevocable undertakings in respect of 136.1 million ZPG shares, representing approximately a 31.03% holding in the company.
"The terms of the acquisition represent an attractive premium that recognises the quality of ZPG's businesses and the strength of its future prospects and allows shareholders to realise today in cash the potential future value of their holdings. I am very excited about the opportunity this offers to our employees, customers and partners as we move to the next stage of ZPG's development and growth," said Alex Chesterman, founder & chief executive of ZPG.
FTSE 100-listed drugmaker AstraZeneca said the GALATHEA Phase III trial for Fasenra did not meet the primary endpoint of a statistically-significant reduction of exacerbations in patients with chronic obstructive pulmonary disease.
"We will now await the results of TERRANOVA and a full evaluation of both trials to determine next steps for Fasenra in COPD," said Sean Bohen, executive vice president, global medicines development and chief medical officer. Results from TERRANOVA are expected later this quarter.
The safety and tolerability findings in GALATHEA were consistent with those observed in previous trials with Fasenra, AstraZeneca added, and the results of the GALATHEA trial do not impact the approved indication in severe eosinophilic asthma.
Back in the FTSE 250, oilfield services firm John Wood Group said it saw "good trading momentum" in the first quarter, with its outlook for 2018 unchanged.
In addition to the usual second-half bias, the phasing of cost synergies, projects and market recovery is expected to result in a 60% weighting of earnings to the second half of the year, John Wood said.
"The first quarter has demonstrated the significant benefits of the operational platform we have created. Our integration programme is ahead of schedule and we are seeing good momentum in trading, cost and revenue synergy delivery," said Chief Executive Robin Watson,
BBA Aviation said its performance in the four months to April 30 was in line with expectations, with revenue up 9.7% year-on-year and like-for-like revenue up 2.9%.
In Flight Support, Signature revenue for the period to end of April grew 14% and on a like-for-like basis was up 5.5%.
For the three months to March 31, BBA said the US Business & General Aviation market saw flight movements grow 2.6% while its Signature unit recorded like-for-like revenue growth of 4.7%.
"Our market outperformance reflects the momentum from the commercial negotiations concluded around the middle of 2017; this outperformance, compared to US B&GA market movements, is expected to moderate as comparatives strengthen in the second half. The US B&GA market was weaker than expected during the first quarter as weather impacted flight movements, particularly in January and March," said BBA.
Support services firm Interserve said it has received a formal notice that it has been referred to the Enforcement Division of the UK Financial Conduct Authority for investigation in connection with its handling of inside information in relation to its exited energy-from-waste business during the period from July 15, 2016 to February 20, 2017.
"The company will co-operate fully with the investigation and will update the market on the outcome in due course," Interserve said.
In the US on Thursday, Wall Street ended higher, with the Dow Jones Industrial Average ending up 0.8%, the S&P 500 up 0.9% and Nasdaq Composite also closing 0.9% higher.
News Corp, the newspaper publisher owned by Rupert Murdoch, after the US market close on Thursday reported third quarter earnings in line with Wall Street expectations, though revenue came in slightly above forecasts.
Adjusted earnings were USD34 million or USD0.06 per share, down from USD39 million or USD0.07 per share. Analysts polled by Thomson Reuters expected earnings of USD0.06 per share. Revenue for the quarter rose to USD2.09 billion from USD1.98 billion last year. Analysts had a consensus revenue estimate of USD2.00 billion.
Revenue at the key news and information services segment, which includes Dow Jones and The Wall Street Journal, rose 2% from a year ago to USD1.29 billion. Among smaller segments, book publishing rose 6%; digital real estate jumped 27%, and cable network programming gained 6%.
In Asia on Friday, the Japanese Nikkei 225 index closed up 1.1%. In China, the Shanghai Composite is flat, while the Hang Seng index in Hong Kong is up 1.3%.
In the economic calendar on Friday, the US export and import price index is at 1330 BST, while the Michigan consumer sentiment index is at 1500 BST and the Baker Hughes oil rig count is at 1800 BST.
"The most inspiring event in the European session could be an appearance by ECB Chief Mario Draghi, when he speaks at the EU State of the Union address in Florence. Draghi is expected to talk up the eurozone economy, despite economic data starting to prelude to a slowdown in momentum. Yet even if the message is talking up the economy we expect him to do so in a cautious tone," Lawler says.
European Central Bank President Mario Draghi speaks at 1415 BST.
