🥇 First rule of investing? Know when to save! Up to 55% off InvestingPro before BLACK FRIDAYCLAIM SALE

UK midcap index at 3-month highs as Virgin Money soars

Published 07/03/2024, 08:46
Updated 07/03/2024, 17:31
© Reuters. Signage for the London Stock Exchange Group is seen outside of offices in Canary Wharf in London, Britain, August 3, 2023. REUTERS/Toby Melville/File photo
UK100
-
HSBA
-
RIO
-
STAN
-
RTO
-
FTMC
-
ENT
-
VMUK
-
NBS
-

By Shristi Achar A and Sruthi Shankar

(Reuters) -British midcap stocks rose to fresh three-month highs on Thursday as lender Virgin Money (LON:VMUK) soared on a possible buyout, while pest control firm Rentokil lifted blue-chip shares following a profit jump.

Shares of Virgin Money UK rallied 35%, their biggest percentage gain on record, after Nationwide Building Society (LON:NBS) agreed to buy the bank in a potential 2.9 billion pound ($3.7 billion) deal to create the country's second-largest savings and mortgage provider.

The offer represented a premium of 38% to Virgin Money's Wednesday close.

"Nationwide is effectively pouncing on Virgin Money at a time when prospects are improving for its industry, albeit we're still in a volatile period until the base rate starts to come down," said Russ Mould, investment director at AJ Bell.

Data from mortgage lender Halifax showed British house prices rose for a fifth month in a row in February, echoing other signs of a recovery in the housing market.

"A 38% bid premium is not overly generous and sits well below the 51% average seen last year with UK-listed takeovers," Mould added, noting that there could be competing offers from other firms.

The UK's domestically oriented FTSE 250 index climbed 0.6% its highest level since Jan. 2.

The blue-chip FTSE 100 rose 0.2% but lagged continental European markets and Wall Street, where surging technology stocks led the main indexes to all-time highs.

Investors mostly took comfort as the European Central Bank acknowledged the progress it had made in bringing down inflation.

© Reuters. Signage for the London Stock Exchange Group is seen outside of offices in Canary Wharf in London, Britain, August 3, 2023. REUTERS/Toby Melville/File photo

Rentokil Initial (LON:RTO) surged 17.7% to become the top gainer among FTSE 100 components after it reported a 50% jump in annual profit.

Entain (LON:ENT) dropped 4.9% after the gambling group said that regulatory measures in the UK and the Netherlands would hurt its profit forecast for the current financial year, while aerospace supplier Melrose fell 2.3% on flagging revenue headwinds.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.