UK stocks inched higher after two days of strong gains in US markets. At 8.30am the FTSE 100 index was up 7 points to 7,005 points led by house builders and leisure stocks while consumer goods and utility companies were on the back foot.
Oil prices retreated slightly after a strong bounce overnight with Brent crude futures dipping 0.2% to $72 per barrel while the gold price retreated to $1,800 per ounce as risk appetite improved.
Sterling staged a small rally to $1.3715 but remains a long way from its early June highs of $1.42 as a result of the move to ‘safe haven’ assets over the last two months.
COMPANY NEWS
Anglo-Dutch consumer goods giant Unilever (ULVR) reported a 5% increase in underlying sales for the second quarter, in line with market estimates, thanks to a recovery in food and refreshment sales which rose 8.1% on an organic basis.
The firm was able to raise prices in its food and refreshment division and its beauty and personal care division, whereas in home care there was a slight erosion of pricing as promotions were higher than the year-ago period. Shares fell 4% to £41.28.
Soft drinks group Britvic (BVIC) posted a 22.8% increase in third quarter sales, which took year to date sales up 3.1%, thanks to revenue growth in all its businesses.
The easing of lockdown restrictions led to a significant bump in demand from the hospitality sector and in the food-on-the-go market. Shares were steady at 959p.
Bus operator FirstGroup (FGP) reported it had sold its First Student and First Transit units for more than expected and therefore it would return a higher than expected £500 million to shareholders this autumn. Shares accelerated 3% to 82p.
Bus and rail operator Go-Ahead Group (GOG) announced it had appointed Christian Schreyer as its new chief executive from the start of November. Schreyer was previously chief executive for northern and central Europe at French public transport operator Transdev. Shares added 1.6% to £10.00.
Kitchen supplier Howden Joinery (HWDN) posted strong first results with sales up 68.8% on the same period last year and 20% above the first half of 2019 thanks to the continued growth of the repair, maintenance and improvement market.
The firm left its guidance unchanged, having raised estimates earlier this month, but it reinstated its interim dividend and said it re-start its £50 million share buyback programme. Shares climbed 2.3% to 900p.
Air conditioning group Volution (FAN) reported full year revenue growth of more than 20% on an underlying basis and said earnings would be ahead of market expectations thanks to healthy margins, despite supply chain challenges. Shares breezed 3% higher to 467p.
Appliance safety control firm Strix (KETL:AIM) posted an upbeat trading update for the six months to June with revenue growth predicted to be around 50% thanks to the inclusion of LAICA and price rises to offset cost inflation. Shares went off the boil, dipping 0.9% to 313p.
DEAL NEWS
Safety and compliance firm Marlowe (MRL:AIM) revealed it had made an approach for document storage company Restore (RST:AIM) at 530p per share, compared with the closing price last night of 420p.
The offer, the second in recent weeks, consisted of 71p per share in cash and the remainder in Marlowe shares, but was rejected. Restore shares soared 16% to 487p.
Podcast firm Audioboom (BOOM:AIM) rejected a possible offer from All Active Asset Capital (AAA:AIM) on the basis it ‘significantly undervalues the business, its progress and potential to capitalise on its market position to generate value for the shareholders’.
In addition, the deal would mean Audioboom shareholders swapping their shares for shares of AAA, where trading has been suspended since the end of April and is due to be cancelled at the end of this month. Audioboom gained another 2% to 950p.
Waste management firm Augean (AUG) announced that negotiations with potential suitor Morgan Stanley Infrastructure were continuing and the deadline for talks had been extended for a second time.
MSI made its initial approach to Augean in late May but talks - presumably over pricing - are set to go on until mid-August with no guarantee of an offer. Augean shares trod water at 295p.
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