UK stocks hit session highs at midday Monday, helped by a jump in housing builders after data showed domestic house price growth approached seven-year highs last month.
Shares in Persimmon (PSN), Taylor Wimpey (TW.) and Barratt Developments (BDEV) all gained over 2.5%. Meanwhile office space firm IWG (IWG) dropped after a profit warning.
At 12pm the FTSE 100 index of leading shares was up 0.3% at 7,091 points.
COMPANY NEWS
Office property owner IWG revealed that the anticipated recovery in its business had been delayed despite strength in some areas since its first quarter trading update.
The firm said that, due to its operational gearing, this lower than expected occupancy would have a ‘significant’ impact on its full year results with operating earnings likely to be ‘well below’ last year’s level. The shares tumbled 13.2% to 318.3p.
Consumer goods group Reckitt Benckiser (RKT) announced it would sell its Chinese infant formula and child nutrition business to private equity firm Primavera Capital for an enterprise value of $2.2bn.
The deal includes an exclusive and perpetual license of the Mead Johnson and Enfa family of brands within China, with Reckitt continuing to and operate own the brands globally outside of China. The shares gave up 0.4% to £64.59.
Media agency S4 Capital (SFOR) increased its net revenue guidance for a second time thanks to an acceleration in growth in the second quarter, sending shares up 5% to 616.3p.
From an original target of a 25% increase this year, the firm increased guidance to 30% after its first quarter, but now sees revenue growing by 35% thanks to ‘overspending’ by technology clients, which make up half of its revenue base.
Logistics group Clipper (CLG) posted strong results for the year to April and raised its outlook for operating earnings for the next two years.
Earnings before interest and taxes (EBIT) for the 2022 and 2023 financial years are seen beating consensus estimates by mid single digits thanks to stronger activity.
The firm also announced a push into the life sciences sector with the acquisition of Wippet and the launch of an online business-to-business marketplace to service the health care sector. The shares climbed 1.5% to 790p.
PHARMA NEWS
Drug maker Astrazeneca (AZN) reported that its leukemia treatment Calquence had shown positive results in clinical trials with a higher progression-free survival rate and fewer events of atrial fibrillation compared with standard treatment in patients with chronic lymphocytic leukemia. The shares dipped 0.6% to £80.06.
Diganostics and cancer therapy firm Avacta (AVCT:AIM) announced that the UK’s Medicines and Healthcare Regulatory Agency had confirmed registration of its AffiDX® SARS-CoV-2 antigen lateral flow test, allowing the company to place the product on the market in the UK for professional use.
Avacta has multiple ongoing commercial discussions with distributors and end user customers in countries that accept the CE mark for in vitro diagnostic products.
The product registration by the MHRA allows the Company to sell the product in the UK for professional use and the Company expects product registration from a Competent Authority within the EU to follow shortly. The shares added 5.7% to 252.5p.
Drug discovery firm Redx Pharma (RDX:AIM) reported strong progress with its pipeline with clinical trials for several of its drug programmes.
The firm posted a first half loss of £12.7 million after increased research and development spending of £6.2 million, but said it had a cash balance of almost £40 million at the end of March, giving it a ‘cash runway through 2022’. The shares lost 5% to 62.6p.
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