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(Alliance News) - Stock prices in London are seen opening higher on Thursday, the last full trading day before Christmas, amid encouraging signs that the Omicron Covid-19 variant is not as severe as previously feared.
In early UK company news, gambling firm Flutter Entertainment made a big acquisition in Italy. Construction firm Balfour Beatty reached a resolution with the US Department of Justice, at a cost of USD65 million. Retail and leisure assets investor Newriver REIT sold a property in Dorset.
IG futures indicate the FTSE 100 index is to open 14.94 points higher at 7,356.60. The blue-chip index closed up 44.25 points, or 0.6%, at 7,341.66 on Wednesday.
Flutter Entertainment said it has acquired Italian online gaming operator Sisal from CVC Capital Partners Fund for EUR1.91 billion, around GBP1.62 billion.
The company, formerly known as Paddy Power Betfair, said the transaction is likely to complete during the second quarter of 2022 and is expected to be accretive to adjusted earnings in the first 12 months after completion.
In addition, Flutter said the deal increases its exposure to an "attractive, fast-growing, regulated online market". The company highlighted Italy is Europe's second largest regulated gambling market and one that has seen online penetration grow from 10% in 2019 to 20% in 2021.
Flutter CEO Peter Jackson commented: "I am delighted to add Sisal, Italy's leading gaming brand, to the group as we look to attain a gold medal position in the Italian market. For some time we have wanted to pursue this market opportunity via an omni-channel strategy and this acquisition will ideally position us to do so. Sisal has grown its online presence significantly in recent years, aided by its proprietary platform and commitment to innovation.
"I'm excited to see how Flutter can complement these capabilities through our scale, differentiated products and operational capabilities."
Balfour Beatty said its US subsidiary Balfour Beatty Communities has reached a resolution with the Department of Justice.
The construction firm said the resolution resolves the DoJ's criminal and civil investigations into some performance incentive fees improperly claimed by Communities between 2013 and 2019 and related to maintenance work at US military housing installations.
Under the terms of the resolutiion, Communities has pleaded guilty to one count of fraud and has agreed to the appointment of an independent compliance monitor for a three-year period. Communities cooperated fully with the DoJ in its investigation, Balfour said.
Communities will pay a total resolution amount of USD65.4 million, comprised of USD33.6 million in penalties and USD31.8 million in restitution, Balfour added.
International Public Partnerships said it has bought a small portfolio of UK public-private partnership investments for an initial GBP3.1 million.
The infrastructure investment company said the portfolio was made up of interests in two community hospitals and minority interests in the Building Schools for the Future projects. Further, investment in minority interests in a further five BSF schemes from the same portfolio and representing up to GBP3.0 million of additional investment, will be made in the coming months, it added.
NewRiver REIT said it has completed the disposal of Poole Retail Park in Dorset for GBP58.0 million. The price is a 7.4% premium to the last valuation and is 30% higher than when it acquired the asset in October 2019.
Chief Executive Allan Lockhart commented: "This disposal demonstrates the strong returns that can be generated from our experienced asset management platform through capital partnerships. In a short space of time we have completed numerous leasing transactions at the retail park which have improved the customer offer and supported the asset's income and valuation. We are delighted to have secured such good pricing on this disposal which demonstrates the inherent liquidity in our portfolio."
In Asia on Thursday, the Japanese Nikkei 225 index closed up 0.8%. In China, the Shanghai Composite closed up 0.6%, while the Hang Seng index in Hong Kong was up 0.4%. The S&P/ASX 200 in Sydney ended up 0.3%.
The upbeat pre-holiday mood was helped by preliminary studies from the UK indicating Omicron infections were less likely to result in hospitalisation compared with the Delta variant, confirming a trend first identified in South Africa.
New research from Imperial College London has indicated that people with PCR-confirmed Omicron are 15% to 20% less likely to need admission to hospital, and 40% to 45% less likely to require a stay of one night or more.
The cautious optimism was also followed news that the US Food & Drug Administration had authorised Pfizer's anti-Covid pill, providing a fresh tool to battle the disease.
Paxlovid, which comprises two types of tablet, was granted an emergency use authorisation by the FDA after a clinical trial showed it to reduce the risk of hospitalisations and deaths among at-risk people by 88%.
"European futures are up as traders have started to believe that Omicron is only likely to suppress economic growth in the short term. In addition to this, news that booster shots of coronavirus vaccines are likely to provide high protection against the new strain and that US officials are reluctant to impose 2020-era lockdowns bolstered investor confidence," said AvaTrade analyst Naeem Aslam.
"Historically, December is characterized by lower volatility; however, we are living in an unusual period in which updates regarding the coronavirus cause large waves in stock markets and significantly affect investors' risk appetite," Aslam added.
The pound was quoted at USD1.3355 early Thursday, up from USD1.3346 at the London equities close Wednesday.
The euro was priced at USD1.1335, up from USD1.1327. Against the yen, the dollar was trading at JPY114.26, marginally higher from JPY114.22.
Brent oil was quoted at USD75.25 a barrel Thursday morning, up from USD74.74 a barrel at the London equities close Wednesday. Gold stood at USD1,805.95 an ounce, higher against USD1,797.90.
Thursday's economic calendar has US initial jobless claims at 1330 GMT, alongside durable goods orders and personal consumption expenditures due at the same time.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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