LONDON MARKETS: FTSE 100 Edges Higher As SABMiller Gains, But Oil Major BP Loses Ground
26 Juli 2016 - 10:43AM
Dow Jones News
By Carla Mozee, MarketWatch
Pound drops as BOE policy maker supports more stimulus
U.K. stocks edged up Tuesday, with shares of SABMiller PLC
gaining after a raised takeover offer for the brewer, but BP PLC
shares dropped following financial results.
The FTSE 100 was up 0.1% at 6,718.98, but pared gains after
opening modestly higher. The index on Monday ended lower by 0.3%.
(http://www.marketwatch.com/story/ftse-100-clings-to-thin-gain-as-banks-drift-lower-2016-07-25)
Investors had plenty of corporate updates to assess Tuesday.
Among them, SABMiller (SAB.JO) received an increased takeover bid
from Anheuser-Busch InBev NV
(http://www.marketwatch.com/story/ab-inbev-increases-offer-for-sabmiller-2016-07-26-3485537)(ABI.BT)
(ABI.BT), to GBP45 a share ($58.85) from GBP44 a share.
The new offer, which values SABMiller at about GBP79 billion
($104 billion), comes as the British pound has slid in the wake of
last month's Brexit vote that will lead the U.K. out of the
European Union.
Shares of Belgium-based Anheuser-Busch were up 0.2%. The pound,
meanwhile, was coming under renewed pressure on Tuesday.
Meanwhile, BT Group PLC (BT.A.LN) popped up 3.6% as the U.K.'s
telecommunications regulator Ofcom called for BT's Openreach
network business to have its own structure, but stopped short of
calling for a full separation of the businesses
(http://www.marketwatch.com/story/bt-arm-should-have-separate-structure-regulator-2016-07-26).
Among decliners, BP PLC shares (BP.LN) (BP.LN) fell 2% after the
oil and gas major posted quarterly underlying earnings of $720
million
(http://www.marketwatch.com/story/bp-posts-replacement-cost-of-225-billion-2016-07-26),
falling short of analysts' consensus of $839 million.
BP also posted a second-quarter replacement cost loss --
analogous to the net income that U.S. oil companies report -- of
$2.25 billion as it booked a multibillion-dollar charge relating to
its 2010 Gulf of Mexico rig blowout and oil spill.
Shares of rival oil major Royal Dutch Shell PLC (RDSB.LN)
(RDSB.LN) were off 0.8%. Shell's financial results are due on
Thursday.
Sterling slips: The pound dropped to $1.3085 compared with
$1.3140 late Monday. The currency was driven lower after Bank of
England policy maker Martin Weale, in a Financial Times interview
published Tuesday
(http://www.ft.com/cms/s/0/03c877ce-5272-11e6-9664-e0bdc13c3bef.html#axzz4FV4zBQoH),
indicated he's now supportive of further stimulus measures by the
central bank to aid the British economy in the wake of the Brexit
vote.
Weale pointed to Markit's PMI report released Friday that showed
contraction in the manufacturing and services sectors
(http://www.marketwatch.com/story/uk-economy-in-dramatic-downturn-after-brexit-vote-data-show-2016-07-22)
in July as a factor in his view.
(END) Dow Jones Newswires
July 26, 2016 04:28 ET (08:28 GMT)
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