LONDON BRIEFING: CMA minded to approve new Microsoft/Activision deal

(Alliance News) - Stocks in London are expected to edge into the red at Friday's market open, after a week dominated by central bank decisions.

In early UK economic news, retail sales recovered somewhat in August after a washout in July amid wet weather. Sales volumes rose 0.4% from the prior month in August, after falling 1.1% in July, according to the Office of National Statistics.

There was more good news for retailers, as consumer confidence continued to rise as inflation eases, according to GfK's indicator.

In company news, the UK competition watchdog said Microsoft's revised takeover proposal for Activision "substantially addresses" its previous competition concerns. Croda named Direct Line's Danuta Gray as its chair designate, to join the firm next year.

Here is what you need to know at the London market open:

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MARKETS

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FTSE 100: called down 5.0 points at 7,673.62

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Hang Seng: up 1.7% at 17,958.41

Nikkei 225: closed down 0.5% at 32,402.41

S&P/ASX 200: closed up 0.1% at 7,068.80

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DJIA: closed down 370.46 points, 1.1%, at 34,070.42

S&P 500: closed down 1.6% at 4,330.00

Nasdaq Composite: closed down 1.8% at 13,223.98

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EUR: down at USD1.0653 (USD1.0658)

GBP: down at USD1.2283 (USD1.2297)

USD: up at JPY148.06 (JPY147.38)

GOLD: up at USD1,924.90 per ounce (USD1,918.13)

OIL (Brent): down at USD93.83 a barrel (USD94.17)

(changes since previous London equities close)

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ECONOMICS

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Friday's key economic events still to come:

10:00 CEST EU flash PMI

09:30 CEST Germany flash PMI

11:00 IST Ireland WPI

09:30 BST UK flash PMI

11:00 BST UK CBI industrial trends survey

12:00 BST UK BoE market participants survey results

09:45 EDT US flash manufacturing PMI

09:45 EDT US flash services PMI

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UK retail sales in August partially recovered from a washout in July, official data showed on Friday, but growth was slightly weaker than market forecasts. The Office for National Statistics said retail sales volumes fell 1.4% annually in August, easing from the 3.1% fall in July, which had first been estimated as 3.2%. The market had been expecting a 1.2% fall for August, according to FXStreet-cited consensus. From the previous month, sales volumes rose 0.4% in August, compared to a fall of 1.1% in July. August's reading was a touch below market consensus, which had forecast a 0.5% rise. July's fall was first reported as 1.2%. The ONS explained that monthly sales growth came from food stores and non-food stores, after wet weather in July had reduced sales of clothing and supermarket food sales.

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UK consumer confidence is continuing to rise against a backdrop of falling inflation – but many households are continuing to struggle with cost-of-living pressures, according to a survey. GfK's long-running Consumer Confidence Index increased four points in September, but remains at a subdued minus 21. Expectations for the UK's wider economy over the next 12 months saw a robust six-point increase to minus 30, 44 points higher than last September.

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The UK formalised an agreement authorising the transfer of personal data with the US, extending a recent deal struck between Brussels and Washington. The agreement will establish a "data bridge" with the US "through the UK Extension" to the EU-US Data Privacy Framework, according to a document published Thursday on the government website. The government said the decision "was based on their determination that the framework maintains high standards of privacy for UK personal data." UK businesses and organisations will be able to "safely and securely transfer personal data to certified organisations in the US" once the regulations come into force on October 12, it added.

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BROKER RATING CHANGES

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JPMorgan raises Hiscox to 'overweight' (neutral) - price target 1,300 (1,200) pence

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JPMorgan cuts Phoenix Group to 'underweight' (neutral) - price target 500 (655) pence

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JPMorgan cuts Lancashire to 'neutral' (overweight) - price target 715 (750) pence

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COMPANIES - FTSE 100

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Croda International said it has appointed Danuta Gray as its chair designate. Gray will join the board from February 1 next year, succeeding Anita Frew at the end of its annual general meeting on April 24. Frew will then retire from the board after serving as chair for nine years. Gray is currently chair at Direct Line Insurance, and serves as a non-executive director at Burberry. "She has served on the boards of a variety of listed companies and her depth of boardroom experience and strong understanding of UK governance will be of enormous benefit to Croda," said Jacqui Ferguson, Croda's senior independent director.

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NatWest said it has resolved an issue with its cash machines after some of the bank's customers reported problems with their accounts. A number of people took to social media site X, formerly Twitter, throughout Thursday complaining money they had deposited in their NatWest accounts was missing. Others expressed concerns they would accrue fees after the issue resulted in their accounts being overdrawn. In a statement early on Friday, a NatWest spokesperson told the PA news agency the issue had been resolved. "Cash payments to a small number of accounts have been delayed," the spokesperson said. "The issue is now resolved and customer accounts are being updated. "No customer will be left out of pocket as a result."

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COMPANIES - FTSE 250

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Ascential said revenue in its first half climbed to GBP307.4 million from GBP260.7 million a year before. Its pretax loss narrowed to GBP11.8 million from GBP41.6 million. The business-to-business media and events firm said it has seen a "solid start" to its second half, which is seasonally weaker than the first six months of the year. "Despite continued macro uncertainty impacting the industries we serve and currency headwinds, our businesses remain well set for the year, supported by multiple growth levers," Ascential CEO Duncan Painter said.

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OTHER COMPANIES

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The UK's competition regulator said the revised merger deal proposed by Microsoft for its takeover of Activision Blizzard "addresses previous concerns and opens the door to the deal being cleared". After blocking the acquisition earlier this year, Microsoft had submitted a restructured transaction to the UK Competition & Markets Authority in August. The revised deal would see Activision's cloud gaming rights sold to an independent third party, Ubisoft Entertainment, before Microsoft completes the takeover. "The CMA considers that the restructured deal makes important changes that substantially address the concerns it set out in relation to the original transaction earlier this year," the regulator said. There remain some limited residual concerns in regards to the new deal, to which Microsoft has put forward remedies. The CMA said it is now consulting on the remedies before making its final decision.

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By Elizabeth Winter, Alliance News senior markets reporter

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