Weir Group acquiring KOP Surface Products, Mitie withholding dividend

London open

The FTSE 100 is expected to open 30 points lower on Monday, after closing up 1.04% at 7,527.33 on Friday.

Stocks to watch

Weir Group announced on Monday that it had entered into an agreement to acquire KOP Surface Products, a provider of advanced surface pressure control technologies, systems and services for the oil and gas industry for $114m in cash. The FTSE 250 company said KOP - which held “leading” market positions in Asia, with an emerging business in the Middle East - was being acquired from Akastor ASA, a Norwegian-listed investor in oilfield services.

Mitie withheld its final dividend as the outsourcing group tumbled into losses, though the new management team expect a return to "modest growth" in underlying profits this year. Reported revenue fell 1% in the year to 31 March to £2.13bn, with an operating loss of £42.9m due to accounting adjustments arising from a review of the business and a resulting loss per share of 14.7p. Adjusted revenues rose marginally with the core facilities management business growing 3%, while adjusted operating profit fell by 14% to £82.0m.

Newspaper round-up

Squeezed British households have cut back their spending for the first time in almost four years, according to figures that underscore the pressures from rising prices and political uncertainty. Visa, the credit and debit card processing business, said its vast database of spending patterns shows there was a drop in spending across a broad range of categories last month, including clothing, household goods, food and transport. - Guardian

Theresa May is to be told the EU will take a year to draft a new mandate for its chief negotiator, Michel Barnier, effectively killing the Brexit negotiations, if she insists on discussing a future trade relationship at the same time as the UK’s divorce bill. In a sign of growing impatience with the shambolic state of the British side of the talks, senior EU sources said that if London insisted on talking about a free trade deal before the issues of its divorce bill, citizens rights and the border in Ireland were sufficiently resolved, it would be met with a blunt response. - Guardian

Theresa May brought back her former adversary Michael Gove last night to stave off a Tory civil war over Europe as she faced overwhelming pressure to soften her stance on Brexit. The prime minister was forced into cabinet changes she would never have contemplated before last Thursday’s election, as bloodletting began over the party’s dismal performance and Tory grandees reopened wounds over Brexit. - The Times

Ireland’s Prime Minister has issued a warning to Theresa May over her plans to do a deal with the DUP to prop up a Tory minority government. Enda Kenny, who has been Taoiseach since 2011, said he had indicated his “concern” to the Prime Minister over the plan and suggested the arrangement, if poorly handled, could jeopardise the peace process in Northern Ireland. - Telegraph

Almost one in four households in Britain will be renting privately by the end of 2021 as soaring house prices and stagnant wages put home ownership out of the reach of growing numbers of people. Around 5m households, or 21% of the total, are in private rented accommodation, a quarter of whom are families with children. - Guardian

US close

Wall Street finished on a mixed note in a light day in terms of corporate and economic news, as Technology shares sold-off alongside data revealing the largest inflows into bonds for 122 weeks.

By the closing bell, the Nasdaq 100 had fallen 2.44%, its worst one-day performance since September.

In prescient fashion, strategists at Bank of America-Merrill Lynch had pointed out the day before how Technology had become the most crowded trade by large-cap active funds that it had ever been, particularly the so-called FANG (the acronym for Facebook-Amazon.com-Netflix-Google) stocks.

Meanwhile, the Dow Jones Industrial Average gained 0.42% or 89.44 points to close at 21,271.97, even as the S&P 500 slipped 0.08% or 2.02 points to 2,431.77 and the Nasdaq Composite dropped 1.80% or 113.85 points to 6,207.92.

From a sector standpoint, the worst performing areas of the market were: Semiconductors (-4.01%), Computer Hardware (-3.62%), Technology Hardware (-3.43%), Internet (-3.31%) and Toys.