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London midday: Stocks bask in sun despite gloomy retail data; Shire surges
London stocks were holding on to small gains by midday on Thursday as investors shrugged off disappointing retail sales data, with Shire surging to the top of the leaderboard amid reports of a takeover offer from Japan's Takeda Pharmaceutical.
The FTSE 100 was up 0.1% to 7,325.41, while the pound was down 0.1% against the dollar at 1.4223 and 0.2% firmer versus the euro at 1.1496.
Equities were holding their own despite uninspiring data from the Office for National Statistics, which showed retail sales fell more than expected in March as consumers stayed away from shops amid snow and sub-zero temperatures swept in by the 'Beast from the East'.
Retail sales fell 1.2% from a month earlier, led by a 7.4% drop in fuel transactions, versus expectations for a small 0.5% drop. Excluding fuel, sales were still down 0.5%, which was more than the 0.4% the market had expected.
Food store sales fell 0.6% as supermarket sales dropped 1.3%. But sales rose 11.8% at specialist food retailers and 9.5% at off licences as shoppers opted for local stores during the bad weather.
Department stores were the only retail sub-sector where sales rose. The ONS said the 0.8% increase was probably linked to shoppers taking up online offers for Easter and Mother's Day when the weather was bad.
Online sales were 17.4% of all retailing in March, up from 15.9% a year earlier. Department store online sales rose by a third from a year earlier, which came as Debenhams reported a 85% collapse in first-half profits.
Ben Brettell, senior economist at Hargreaves Lansdown, said: "The weather meant a disappointing retail sales reading for March was all but guaranteed, but the figures were even worse than anticipated."
On the corporate front, Shire rallied on reports it has received a takeover approach from Takeda. The Japanese company, which has a smaller market value than its British rival, made an "indicative takeover proposal" at close to $46.50 pounds a share, Reuters reported, citing two sources.
Elsewhere, advertising giant WPP was on the front foot after solid first-quarter results from French peer Publicis.
Rentokil International gained despite saying that revenue growth slowed in 2018 because of the impact of the hurricane in Puerto Rico and cold weather in the US that delayed the emergence of spring pests.
Essentra was on the front foot after the supplier of plastic and fibre products said trading in the financial year-to-date has been in line with the board's expectations, as it announced the departure of its group finance director.
Mining and energy engineer Weir rallied as it launched a rights issue after striking a $1.3bn deal to take over US mining tools manufacturer Esco Corp. First quarter orders were also reported as higher.
Unilever fell as it said sales growth slowed in the first quarter from the end of last year, though the consumer goods colossus remained confident of hitting its full-year target for underlying sales growth of 3-5%.
Broadcaster Sky - which is currently the subject of a bidding war - slipped even as it posted a 5% rise in nine-month like-for-like revenues as core earnings rose 14% and said it remains on track for the full year.
Defence company Ultra Electronics was under the cosh as the Serious Fraud Office said it has opened a criminal investigation into suspected corruption in the conduct of its business in Algeria.
Acacia Mining lost its shine after it posted a 33% drop in first-quarter revenue as it took a hit from export ban in Tanzania.
In broker note action, Hammerson was in focus after abandoning its bid for Intu Properties on Wednesday. Peel Hunt upgraded the stock to buy', while Jefferies lifted it to 'hold', but Goldman Sachs cut Hammerson to 'neutral'. Intu meanwhile was downgraded to 'underweight' by Barclays.
Elsewhere, Peel Hunt upgraded Bellway to 'buy', while National Express was cut to 'hold' at Liberum, Croda was cut to 'neutral' at JPMorgan, while Polymetal was upgraded to 'neutral'.
The main FTSE indices were battling a considerable weight from the mass of large stocks going ex-dividend, including Aggreko, BAE Systems, Balfour Beatty, Barratt Developments, Bodycote, Capital & Counties Properties, Croda, Drax, Greggs, Informa, Inmarsat, Intu Properties, Lloyds Banking, Polypipe, RPS Group, Rathbone Brothers, Standard Life Aberdeen and UBM.
Market Movers
FTSE 100 (UKX) 7,325.41 0.11%
FTSE 250 (MCX) 20,093.38 0.41%
techMARK (TASX) 3,404.60 0.41%
FTSE 100 - Risers
Shire Plc (SHP) 3,940.00p 4.95%
WPP (WPP) 1,163.00p 4.21%
Rentokil Initial (RTO) 280.40p 2.75%
Evraz (EVR) 409.30p 1.66%
HSBC Holdings (HSBA) 686.00p 1.40%
Standard Chartered (STAN) 740.10p 1.40%
Ferguson (FERG) 5,488.00p 1.33%
St James's Place (STJ) 1,109.50p 1.32%
Paddy Power Betfair (PPB) 7,320.00p 1.31%
Smiths Group (SMIN) 1,567.50p 1.29%
FTSE 100 - Fallers
Standard Life Aberdeen (SLA) 365.40p -4.04%
Lloyds Banking Group (LLOY) 65.72p -2.81%
BAE Systems (BA.) 586.65p -2.29%
Ashtead Group (AHT) 2,061.00p -1.95%
Unilever (ULVR) 3,874.78p -1.82%
National Grid (NG.) 812.90p -1.59%
Informa (INF) 730.40p -1.43%
Mediclinic International (MDC) 672.60p -1.38%
Next (NXT) 5,126.00p -1.23%
Imperial Brands (IMB) 2,396.50p -1.18%
FTSE 250 - Risers
Weir Group (WEIR) 2,226.00p 5.10%
Hochschild Mining (HOC) 227.30p 4.31%
Aveva Group (AVV) 2,146.00p 4.17%
Essentra (ESNT) 446.00p 3.34%
TI Fluid Systems (TIFS) 262.00p 3.15%
Mitchells & Butlers (MAB) 274.60p 2.92%
Capita (CPI) 153.20p 2.85%
Virgin Money Holdings (UK) (VM.) 275.00p 2.73%
Renishaw (RSW) 4,954.00p 2.69%
Paragon Banking Group (PAG) 503.50p 2.59%
FTSE 250 - Fallers
Ultra Electronics Holdings (ULE) 1,272.00p -8.36%
Intu Properties (INTU) 191.75p -4.08%
Bodycote (BOY) 901.50p -3.79%
John Laing Group (JLG) 278.00p -2.80%
Inmarsat (ISAT) 358.90p -2.74%
RPC Group (RPC) 786.80p -2.62%
Greggs (GRG) 1,234.00p -2.22%
Drax Group (DRX) 303.60p -2.19%
Ferrexpo (FXPO) 230.30p -1.96%
National Express Group (NEX) 406.20p -1.55%