London close: Stocks finish firmer as investors cheer Babcock disposal

(Sharecast News) - London stocks closed in the green on a relatively quiet Friday in London, as investors digested the latest import price data from across the pond.
The FTSE 100 ended the session up 0.35% at 7,218.71, and the FTSE 250 was ahead 0.18% at 23,788.45.

Sterling was in a mixed state, last rising 0.35% on the dollar to $1.3856, while it weakened 0.2% against the euro to trade at €1.1747.

"It has been a volume-light week for equity markets despite the excitement surrounding all the US price data we've received this week, but the bulls have come out on top once again, shrugging off fears of a Friday the 13th-related hiccup," said IG chief market analyst Chris Beauchamp.

"Despite the rise in Delta-variant case numbers, the rebound in earnings on both sides of the Atlantic continues to provide a reason to invest in stocks, record highs for major indices on the two continents being taken as a sign of strength and not irrational exuberance.

"While the FTSE 100 has made headway today, briefly touching its highest level since February 2020, it continues to lag behind on a longer-term view, a victim perhaps of ongoing concerns that the UK's recovery is still far from complete, and also of being overlooked as fund managers concentrate on the wider variety of investments available in the US and combined European geographies."

While there was nothing much on the economic front on home shores, fresh data in the afternoon showed the price of US goods purchased overseas rose by less than expected last month, despite the higher cost of fuel imports.

According to the US Department of Labor, the US import price index increased at a seasonally-adjusted month-on-month pace of 0.3% in July, below the 0.6% rise pencilled in by economists.

Fuel import prices rose by 2.9% in comparison to the month before, but excluding that, prices were flat.

Compared to a year ago, import prices climbed 10.2%.

On the export side of the equation, prices increased by 1.3% on the month, despite a 1.7% fall in the price of agricultural imports, while non-agricultural import prices rose by 0.6%.

Overnight in China, meanwhile, authorities closed the Meishan terminal at the Ningbo-Zhoushan container port after a worker tested positive for Covid-19.

The terminal accounts for roughly a quarter of container traffic at Ningbo-Zhoushan, the world's third-largest container port.

A similar incident in May at the Yantian port in Shenzhen lasted for about a month, and led to snarl-ups in supply chains across the world that lasted for a month.

This time around, however, the impact could be larger, due to the projected increase in demand for all manner of goods heading into the end of the year.

In equities, defence and aerospace engineer Babcock leapt 6.39% after it sold its Frazer-Nash Consultancy to US peer KBR for £293m, as part of its disposal programme to bolster its balance sheet.

Frazer-Nash provides engineering and technology solutions across a broad range of national infrastructure, to operators and regulators from a network of nine UK and four Australian locations.

The consultancy, which Babcock acquired in 2007, employs around 900 people.

Vectura closed flat, after its board of directors recommended a £1.1bn takeover by Philip Morris International following the close of trading on Thursday.

The proposed acquisition valued the company at 165p a share, a 10p-a-share premium to a rival 155p-a-share offer from US private equity firm Carlyle.

On the downside, Avon Protection plunged 27.73% after it cut its revenue guidance for 2021 and 2022, because of delayed orders and supply chain disruption.

The firm said it expected 2021 revenue to be in the range of $245m-$260m and reduced its guidance for 2022 revenue to $320m-$340m.

Cash conversion in 2021 was likely to be about 50% because of inventory build-ups and delayed receipts from customers.

Market Movers

FTSE 100 (UKX) 7,218.71 0.35%
FTSE 250 (MCX) 23,788.45 0.18%
techMARK (TASX) 4,783.05 0.60%

FTSE 100 - Risers

SEGRO (SGRO) 1,262.00p 2.19%
Polymetal International (POLY) 1,513.00p 1.92%
SSE (SSE) 1,623.00p 1.75%
Flutter Entertainment (CDI) (FLTR) 14,195.00p 1.68%
Pershing Square Holdings Ltd NPV (PSH) 2,605.00p 1.56%
ITV (ITV) 121.25p 1.55%
AstraZeneca (AZN) 8,431.00p 1.53%
Land Securities Group (LAND) 733.00p 1.50%
BHP Group (BHP) 2,319.50p 1.49%
Rolls-Royce Holdings (RR.) 111.18p 1.48%

FTSE 100 - Fallers

Phoenix Group Holdings (PHNX) 665.00p -2.56%
Hargreaves Lansdown (HL.) 1,486.50p -1.69%
Evraz (EVR) 588.80p -1.61%
Abrdn (ABDN) 284.90p -1.14%
Royal Dutch Shell 'B' (RDSB) 1,438.80p -1.06%
Ocado Group (OCDO) 1,780.00p -1.06%
Pearson (PSON) 784.60p -0.98%
InterContinental Hotels Group (IHG) 4,598.00p -0.86%
Intertek Group (ITRK) 5,222.00p -0.84%
Glencore (GLEN) 336.10p -0.74%

FTSE 250 - Risers

Babcock International Group (BAB) 326.20p 6.39%
Indivior (INDV) 173.50p 5.26%
Sirius Real Estate Ltd. (SRE) 122.60p 3.71%
CMC Markets (CMCX) 420.50p 3.57%
Savills (SVS) 1,334.00p 2.92%
Restaurant Group (RTN) 124.00p 2.84%
Auction Technology Group (ATG) 1,410.00p 2.78%
Mediclinic International (MDC) 284.20p 2.75%
Ultra Electronics Holdings (ULE) 3,170.00p 2.46%
Mitie Group (MTO) 70.20p 2.33%

FTSE 250 - Fallers

Avon Protection (AVON) 2,172.00p -27.73%
Tyman (TYMN) 425.50p -4.94%
Just Group (JUST) 93.90p -4.33%
Harbour Energy (HBR) 357.60p -3.77%
Ferrexpo (FXPO) 404.80p -3.07%
Chrysalis Investments Limited NPV (CHRY) 263.00p -2.59%
Energean (ENOG) 650.50p -2.47%
Discoverie Group (DSCV) 1,038.00p -2.26%
Synthomer (SYNT) 554.00p -2.22%
Tullow Oil (TLW) 46.82p -2.18%