LONDON MARKETS: British Stocks Enjoy Best Day In Six Months On Pound Collapse, Merger Buzz
July 29 2019 - 12:16PM
Dow Jones News
By Steve Goldstein, MarketWatch
British stocks on Monday enjoyed their best single-day
performance in six months as the pound collapsed on concerns the
U.K. will leave the European Union without an agreed-upon deal.
The FTSE 100 rallied 1.82% to 7,686.61, the best gain of the
major European stock markets
(http://www.marketwatch.com/story/europe-stocks-nudge-up-on-ma-and-earnings-news-as-lse-surges-while-heineken-fizzles-2019-07-29).
The pound tumbled through the $1.23 level to a two-year low as the
new Boris Johnson government stepped up plans to leave the EU in a
so-called no-deal Brexit.
Traders also flocked to bonds, as the yield on the benchmark
10-year Gilt fell 4 basis points to 0.65%.
Read: British pound falls below key level, reaches new two-year
low on no-deal Brexit concerns
(http://www.marketwatch.com/story/british-pound-reaches-two-year-low-on-no-deal-brexit-concerns-2019-07-29)
The M&A news didn't inspire the action across the Atlantic
as U.S. stocks traded in a tight range. The U.S. Federal Reserve is
due to cut interest rates on Wednesday, with the markets unsure
whether the rate cut will be a quarter-point or a half-point.
In its first major deal since ex-Goldman Sachs executive David
Schwimmer took the reins as CEO, the London Stock Exchange Group
(LSE.LN) said it's in talks to buy Refinitiv, owned by Blackstone
(BX) and Thomson Reuters (TRI), in a $27 billion deal to bulk up
its offerings of financial data and infrastructure. LSE shares
jumped nearly 15%.
Also read: Five things you need to know about the LSE-Refinitiv
merger
(http://www.marketwatch.com/story/five-things-you-need-to-know-about-the-lse-refinitiv-merger-2019-07-29)
Analysts at UBS, who rate LSE at neutral, said the deal would
lift LSE earnings by 8% in its first year and by 20% in year three,
excluding any refinancing benefits.
Just Eat(JE.LN) jumped 23% to 780 pence after it and
Takeaway.com (TKWY.AE) announced merger talks, in a deal where the
Dutch-listed group would buy the U.K.-listed company in a stock
swap valuing Just Eat, using Friday's closing prices, at 731 pence
a share. Activist investor Cat Rock has stakes in both food
delivery companies and has been reported to be pushing for a
deal.
Heavyweight Vodafone Group (VOD.LN) (VOD.LN) extended last
week's gains from announcing it may sell its European towers
business, with shares rising another 4.3% on Monday.
Ferguson shares (FERG.LN) rose 2.3% as Sky News reported that
Nelson Peltz's Trian
(https://news.sky.com/story/activist-peltz-wants-plumber-ferguson-to-sell-uk-business-11772459)
has urged the plumbing products distributor to sell its U.K.
business.
(END) Dow Jones Newswires
July 29, 2019 12:01 ET (16:01 GMT)
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