Shire shows off strong interims, Smith & Nephew confirms buyback

London open

The FTSE 100 is predicted to rise 10 points on Monday morning, following on from its positive finish to 6,793.47 at the end of last week.

Stocks to watch

First-half results from Shire confirmed the drugmaker's strong performance so far in 2016, completing two acquisitions and continuing to grow its underlying business. Just a week after it published second-quarter results, Shire posted interim numbers that showed total reported product sales up 36% to $3.9bn, thanks to double digit product sales across all legacy businesses and $559m of product sales from almost one month from the newly acquired Baxalta. Earnings before interest, tax, depreciation and amortisation rose 35% on the previous year to $1.9bn.

Support services and construction group Interserve has been awarded a two-year extension of its contract to provide security services to the BBC worth more than £20m. Interserve has been providing the BBC with security services since 2014, when it was awarded the company’s National Security Contract on a three-year deal.

Global medical technology business Smith & Nephew has completed the divestiture of its gynaecology business to Medtronic, for $350m. The FTSE 100 firm said the sale of its gynaecology business demonstrates its “disciplined strategic approach” to capital deployment and that shareholders will benefit directly through a $300m share buy-back programme.

Newspaper round-up

Thousands of retail investors are likely to be denied the chance of buying shares in Lloyds at a discount as the government is expected to abandon the plan in the aftermath of market uncertainty caused by Brexit. The government put plans for a “Tell Sid” offer of Lloyds shares on hold in January because of market turmoil and City sources believe that chancellor Philip Hammond is about to abandon permanently the eye-catching offer that was announced by his predecessor.

Business confidence has fallen by less than expected after Britain’s vote to leave the European Union, while shoppers have largely shrugged off Brexit, the latest monthly surveys show. The accountancy firm BDO said its business trends figures for July found minor falls in optimism, based on growth prospects six months out, and in output, measuring “companies’ experience of orders for the three months ahead”. - The Times

Britain’s vote to leave the EU has had little immediate impact on people’s spending habits, according to new figures that suggest more money was splashed out on clothes, meals out and day trips in July. Consumer spending picked up in July as the warm weather provided an incentive to eat out and buy new summer clothes, figures from Visa compiled by Markit showed, contrasting with signs of a drop in business activity following the June vote to leave the EU. - Guardian

US close

A better-than-expected US jobs report for July pushed the Nasdaq Composite to its first record close in a year at the end of the week, alongside fresh highs for the S&P with financials and transport stocks spearheading the rise.

The Dow Jones Industrial Average rose 1.04% or 191.48 points to 18,543.53, the S&P 500 gained 0.86% or 18.62 points to 2,182.87 and the Nasdaq moved up 1.06% or 54.87 points to finish at 5,221.12.

In contrast, oil prices retreated with West Texas Intermediate crude oil futures drifting four cents lower to $41.80 per barrel.