(Alliance News) - It was a muted end to the week for stocks in London on Friday, following a strong week of gains amid the US election uncertainty.
Democrat Joe Biden pulled ahead of US President Donald Trump in the potentially decisive state of Pennsylvania on Friday, putting him on the brink of victory in an increasingly tense White House race.
Pennsylvania, and its 20 electoral votes, would be enough to put the 77-year-old Biden past the magic number of 270 votes in the Electoral College, which determines the presidency.
With tens of thousands of votes remaining to be counted, many of them from heavily Democratic areas, Biden opened up a 5,500-vote lead over the Republican incumbent, real-time state election results showed.
Biden currently has at least 253 electoral votes and is leading in three other states - Arizona, Georgia and Nevada - where votes from Tuesday's bitterly contested election continue to be counted.
With his reelection hopes fading, Trump is making it clear, however, that he is not ready to accept defeat, launching unsubstantiated claims of voter fraud and claiming that he won.
The FTSE 100 index of London large-cap stocks closed up 3.84 points, or 0.1%, at 5,910.02 on Friday. For the week, the blue chip index has gained 5.9%.
The FTSE 250 lost 10.70 points, or 0.1%, at 17,917.83. The midcap benchmark rose 4.1% over the past five days. The AIM All-Share gained 0.4% to 982.72 Friday.
The Cboe UK 100 index closed up 0.1% at 586.84. The Cboe 250 ended down 0.2% at 15,123.84. The Cboe Small Companies rose 1.0% to 9,770.87.
The CAC 40 stock index in Paris lost 0.5% on Friday, and Frankfurt's DAX 30 gave back 0.7%.
"An action-packed week is drawing to a close, but it appears we may soon have an official result in the US election. Vote-counting goes on, but in Pennsylvania Joe Biden appears to have sufficient votes to give him the state and the 20 Electoral College votes to push him past 270. Of course, the Trump campaign is not giving up and this is why we have not seen much of a relief rally, although in all fairness the market has done that already this week, and in impressive style," IG Chief Market Analyst Chris Beauchamp said.
Stocks in New York were in the red the London equities close, with the weeki's rally finally running out of steam, with the Dow Jones Industrial Average down 0.2%, the S&P 500 index down 0.1%, and the Nasdaq Composite 0.3% lower.
SpreadEx analyst Connor Campbell said: "Exhausted after the giddiness displayed earlier in the week, the news that Joe Biden has likely won Pennsylvania - and therefore the presidency - failed to move the Dow Jones."
"No longer needing to escape the Covid-19 depression it found itself in at the end of October, the Dow may now be more hesitant to move higher in the face of the potential recounts and legal challenges that are going to be part of the election aftermath. Already it has been confirmed that there will be a recount in Georgia, a state where Biden is leading by just 1,579 votes, while Trump is pushing for one in Wisconsin," Campbell added.
In London, RSA Insurance lost 3.0% Friday, having leapt 40% higher late Thursday. It backed a GBP7.2 billion takeover proposal from a two-headed consortium. The company on Thursday had confirmed Canadian insurer Intact Financial and Danish insurer Tryg have made a proposal to buy the FTSE 100-listed firm and divide it up between them.
The proposal, RSA said, comprises 685 pence in cash per RSA share, plus payment by RSA of the announced interim dividend of 8 pence per share. RSA shares closed at 650.20p Friday.
"RSA's approach from Canada's Intact and Denmark's Tryg has excited the market with investors bidding up shares in Aviva, Legal & General and Prudential in the hope that there could be further consolidation in the market," Mould said.
Aveva gave back 2.4%, as it plans to raise GBP2.84 billion through a rights issue of shares, which will go towards the USD5.0 billion acquisition of data management software firm OSIsoft.
Under the rights issue, for every nine existing shares held in AVEVA, shareholder will be entitled to buy seven rights issue shares. This will lead to the issue of 125.7 million shares.
The rights issue will be conducted at a price of GBP22.55 per share, reflecting a discount of 33% to the theoretical ex-right price of GBP33.28 by reference to Thursday's closing price.
Shares in the FTSE 100 information technology firm closed at 4,065.00p Friday.
In the midcaps, Rank Group gained 9.4%, after it successfully raised planned GBP70 million from share offer at 90 pence each. B
Broker Peel Hunt placed 76.7 million shares with existing and new institutional investors, and retail investors subscribed for 1.0 million shares. Of the placing shares, major shareholder Hong Leong took 43.7 million, accounting for GBP39.3 million of the raise, or 56% of the total.
The cash will be used to strengthen Rank's balance sheet, in order to maintain "appropriate liquidity covenant headroom" on its debt facilities under various trading scenarios. It also will provide "ample" working capital to operate through "this challenging trading environment".
At the other end of the FTSE 250, James Fisher & Sons lost 26%. During the third quarter of 2020, the marine services company said it "did not see the improvement to trading conditions". James Fisher was waiting for a "seasonal uplift" during the period and due to it not being forthcoming, revenue for the nine months ended September was down 17% year-on-year.
easyJet gave back 2.9%. The budget carrier said it now plans to fly "no more than 20%" of its planned capacity for the first quarter of financial 2021 due to the latest Covid-19 restrictions in the UK, Germany and France. easyJet also announced the sale and leaseback of 11 aircraft, netting the carrier USD169.5 million.
Urban&Civic jumped 64%. The Wellcome Trust said Friday afternoon it has received further support for its GBP506.0 million takeover of property and land developer Urban&Civic PLC.
The research charity has gained support from Investec Wealth & Investment, which holds 14.1 million shares, reflecting a 9.7% interest in the company.
As a result, Wellcome has gained support for the acquisition from holders of 27.0 million shares in Urban&Civic, representing 19% of the company entire issued share capital.
Under the acquisition's terms, Wellcome will acquire Urban&Civic for 345 pence per share, reflecting a 64% premium to the company's closing price of 211.0 pence on Thursday and above Urban&Civic's EPRA net asset value on September 30 of 343.2p.
Shares in Urban&Civic ended at 345.50 pence on Friday, giving a market capitalisation of GBP501.6 million.
The dollar was lower across the board Friday. The pound was quoted at USD1.3172, up from USD1.3097 on Thursday evening.
The euro stood at USD1.1887, up from USD1.1820. The dollar was down against the yen, at JPY103.33 from JPY103.71 late Thursday in London.
Brent oil fetched USD39.66 Friday evening, down from USD40.87 at the London equities close on Thursday.
Gold prices were higher Friday. The precious metal was quoted at USD1,952.40, up from USD1,946.20.
In the economic calendar next week, a quiet Monday is headlined by German trade balance data at 0700 GMT, while China consumer price index data is due early Tuesday. On Thursday, there is UK trade balance and German consumer price index data at 0700 GMT, followed by US consumer prices at 1330 GMT. Friday is headlined by eurozone GDP data at 1000 GMT and US producer prices at 1330 GMT.
In the UK corporate calendar on Monday, upstream oil company Kosmos Energy and online travel agent On The Beach will issue trading statements. Funeral service provide Dignity will release third quarter results.
By Paul McGowan; paulmcgowan@alliancenews.com
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