U.K. Stocks End Two Days of Losses; Cairn Energy, SABMiller Shares Advance
U.K. stocks rose, ending a two-day losing streak, as gains in Cairn Energy Plc and SABMiller Plc offset losses in Vedanta Resources Plc and De La Rue Plc.
Cairn Energy climbed after Vedanta confirmed it has held talks with the oil and gas exploration company to buy some assets. Vedanta’s shares dropped 7.5 percent. SABMiller and Diageo Plc rose as food and beverage stocks advanced in Europe. Dana Petroleum Plc plunged after it said it would not recommend a takeover offer from Korea National Oil Corp. De La Rue slumped after it announced that James Hussey had resigned as the company’s chief executive officer.
The benchmark FTSE 100 Index climbed 0.4 percent to 5,266.06 at the 4:30 p.m. close in London, having swung between gains and losses more than 10 times today. The gauge has climbed 50 percent since March 2009 as governments and central banks around the world maintained low interest rates and committed more than $12 trillion to support the global economy. The FTSE All-Share Index gained 0.2 percent and Ireland’s ISEQ Index lost 0.6 percent.
“The market seems more responsive today as opportunities to pick up stock arise; indiscriminate purchases are being seen with mostly hedge fund buyers and derivative traders active,” said Thomas Laschetti, a trader at Tullett Prebon Ltd. in London.
Cairn Energy, Vedanta
Cairn Energy climbed 1.8 percent to 452.8 pence. Vedanta confirmed it has started talks to acquire a stake in Cairn India Ltd. Vedanta’s shares sank 7.5 percent to 2,181 pence, the stock’s biggest decline in more than a year.
SABMiller, the world’s second-largest brewer, rose 1.7 percent to 1,898 pence as food and beverage shares were the best performers in Europe today. Anheuser-Busch InBev NV posted second quarter net income that beat analysts’ estimates because of strong sales at the soccer World Cup. Diageo, which makes Guinness, advanced 1.2 percent to 1,109 pence.
Centrica increased 3.3 percent to 330.1 pence. Britain’s biggest energy supplier said its North American unit Direct Energy reached an agreement with Suncor Energy to buy its natural gas assets in the Wildcat Hills region of Alberta, Canada for C$375 million ($358.3 million) in cash.
Dana, De La Rue Tumble
Dana Petroleum plunged 3.7 percent to 1,630 pence, the stock’s biggest drop in more than a month. The U.K. explorer focusing on the North Sea and Africa said it can’t recommend a 1.7 billion-pound ($2.7 billion) takeover bid from KNOC, which is unwilling to increase its offer.
De La Rue tumbled 10 percent to 711.5 pence, the stock’s lowest price since 2005, after Hussey resigned as CEO. One of its factories suspended operations on July 20 following production problems. Hussey’s decision to quit came from “his belief that he must take responsibility for this,” the Basingstoke, England-based company said.
Phoenix IT Group Ltd. slumped 4.8 percent to 218.5 pence. The computer-services company said its annual contract value has remained stable and its order book has fallen from 353 million pounds at March 31 to 349.3 million pounds.