Market Report: Standard Chartered takeover talk fails to impress the City

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Brokers in Asia might think a take-over of Standard Chartered is on the cards, but the City isn’t convinced.

A report overnight from Hong Kong-based CLSA suggested that the struggling bank, whose shares have slumped 40% this year amid a slowdown in its main Asian market — making it the biggest non-mining faller on the FTSE 100 — could be vulnerable to a takeover.

CLSA’s analysts said: “The worse the situation gets for StanChart, we believe the more likely it is that a white knight will eventually emerge.”

They touted DBS Group as the most-likely acquirer, though the Singapore bank told Bloomberg “it’s not on our agenda”.

Standard Chartered’s Hong Kong-listed shares advanced, but the rise was not reflected in London as the stock drifted 0.5p lower to 549.4p, suggesting that there is little confidence from investors that a takeover bid would be forthcoming.

The FTSE 100 retreated 12.65 points to 6089.89 with low trading volumes as many City dealers began to wind down before a lengthy, Christmas break.

Miners and oil firms littered the leaderboard as commodity prices took a break from the beatings they have become accustomed to this year. 

Embattled miner Anglo American, the worst blue-chip performer of the year, down 77%, put on 13.65p to 277.2p, while BP rose 4p to 344.35p.

Grocery-delivery firm Ocado, yet to wow investors with its first overseas deal, dropped 6.3p to 332p on the mid-cap table, while fashion firm N Brown fell 6p to 297p as Jefferies cut its target price for the company.

The Restaurant Group, the Frankie & Benny’s owner, will fly to record highs next year according to UBS, which urged clients to gobble up the shares. They improved to 674p, 18.5p closer to UBS’s 860p target price, as the Swiss broker reckons it could open more than 1000 new eateries across the country, way more than the 250 management is aiming to unveil.

Frankie-and-Bennys.jpg

On the up: Frankie & Benny’s owner The Restaurant Group (Picture: The Restaurant Group)

On AIM, online fishing-tackle retailer Fishing Republic sank 0.75p to 16p after raising £500,000 in a share placing at 16p a pop to fund its expansion in the south of England.

Meanwhile, Applied Graphene Materials, which claims to have come up with a way to commercialise the so-called “miracle material” graphene, dipped 10p to 185p as it banked £10.1 million in a discounted placing and open offer.

Source Article from http://www.standard.co.uk/business/market-report-standard-chartered-takeover-talk-fails-to-impress-the-city-a3140551.html

December 18, 2015 |
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