Markets look set to end the week flat as a busy few days for corporate results provides no seriously nasty surprises.
Blue chip stocks in London trade 0.1% higher in early deals at 6,730 despite modest gains in sterling overnight against the dollar.
Key features of a mixed Friday trading session include two profit warnings and a couple of takeover attempts in the commodities sector.
Industrial distributor Essentra (ESNT) and technology outfit Laird (LRD) are among the bigger losers as they warn on weak demand in international markets.
Moving the other way, mineral sands miner Sierra Rutile (SRX:AIM) and oil producer Gulf Keystone Petroleum (GKP:AIM) attract acquisition interest as big money starts to prowl the bombed out commodities sector.
PROFIT WARNINGS
Shares in industrial distributor Essentra fell more than 20% to 469p as delays on contracts in its cigarette filter manufacturing division and its health and personal care packaging business weighed on first half performance.
Chief executive Colin Day, who led the company's $455 million (£302 million) acquisition of personal care packaging business Clondalkin in 2014, is set to stand down, according to Essentra's interim report.
Laird chief executive David Lockwood says profit in 2016 is likely to be in line with expectations but only because of currency fluctuations which increase the value of overseas profit.
A 'rapid and substantial downturn' in US rail freight markets, in which Laird provides wireless monitoring services, is one area being flagged by Lockwood.
Weakening sales of smartphones also weighed on results in the first half, which saw operating profit dip 31% to £21.1 million in the six months to 30 June.
Organic revenue at Laird declined 3.6% though overall revenue gained 15% to £353 million because of acquisitions.
TAKEOVER TARGETS
While profit warnings are the main news among the market's larger companies, takeover activity is creating interest among the small caps.
Minerals sands miner Sierra Rutile jumps 2.7% to 38.5p after revealing a 36p per share takeover approach from Iluka Resources.
This looks like an opportunistic, low-ball offer that will get rejected.
The miner is forecast to enjoy a large kick-up in earnings over the coming few years so shareholders may demand Iluka significantly increases its offer.
Gulf Keystone Petroleum also jumps on takeover news, rising 5.9% to 4.13p as Norwegian oil and gas operator DNO said it plans to made a bid for the group.
Mobile radio specialist Sepura (SEPU) is another stock impacted by takeover chatter, nudging ahead 2.3% after it revealed interest just before the market close last night.
It received a preliminary approach from an unnamed third party which it says no longer intends to submit any proposal.
RECKITT'S SOUTH KOREA HIT
In other market news, Barclays (BARC) is among the biggest blue chip gainers, up 5.6% to 154.8p, on little sign of panic following Brexit.
Chief executive Jes Staley says it’s business as usual for the UK and US-focused lender.
The market also welcomed a lower than expected fall in net profit to £803 million during the second quarter.
Consumer products powerhouse Reckitt Benckiser (RB.) loses 2.3% at £72.70 as interim operating profits fall 19% to £762 million and second quarter like-for-like sales growth disappoints, both reflecting a hit from a humidifier sanitiser scandal in South Korea, where Reckitt has been charged with false labelling.
The Dettol-to-Durex brand owner reiterates its full-year guidance for 4-5% like-for-like growth, but at the lower end of the range due to the South Korea issues.
Indian fashion e-commerce minnow Koovs (KOOV:AIM) falls 12.5% to 70p despite results for the year to March revealing a 148% top line surge to £5.2 million, investors focusing on significantly widened losses of £16.7 million (2015: £9.4 million) which reflect a ramp-up in the small cap's costs.
Online musical instruments retailer Gear4music (G4M:AIM) gains 10.6% at 135.5p on a sweet-sounding trading statement flagging a strong start to the year.
CEO Andrew Wass reports 66% growth in like-for-like sales for the four months to June and insists Gear4music 'is well capitalised and well positioned to take advantage of the short-term export opportunities created by the UK's EU Referendum vote'.
