Weekly review

The FTSE 100 ended the week up 42.22 points, or 0.54%, closing at 7,914.13 on Friday.

Equity view

Payments firm Network International on Friday confirmed it had received a “highly preliminary” rival 400p a share cash offer from Canada's Brookfield Asset Management. The latest bid trumps a non-binding takeover proposal from a consortium of CVC and Francisco Partners about a cash offer of 387p a share which Network said it was minded to accept if a firm bid was made.

FTSE 250-listed International Public Partnerships said it had increased the committed size of its existing corporate debt facility by £100m to £350m to support the company's investment pipeline. In addition, the company will retain a flexible 'accordion' component which would, subject to lender approval, allow for a further increase in the committed size of the facility to £400m. The maturity date of the CDF has also been amended from March 2024 to June 2025.

Petrofac said on Friday that it has entered into an agreement to extend $252m of its banking facilities. The energy services company and its lenders have agreed a 12-month extension of the revolving credit facility and both bilateral bank facilities to October 2024.

Pantheon International (PIP) reported an unaudited 31 March net asset value (NAV) of 456.6p per share in an update on Friday. The FTSE 250 company said that represented a decrease of 6.8p, or 1.5%, from its net asset value per share on 28 February.

Rio Tinto reported record first-quarter iron ore shipments from its Plibara operations in Western Australia as China ramped up steel production, but cut copper output guidance due to issues at its US Kennecott and Chilean Escondida operations. Iron ore shipments rose 16% to 82.5 million tonnes of the steel-making material, beating a prior first-quarter record of 80.3 million tonnes set in 2018.

Ventilation products maker Volution said it has bought I-Vent in Slovenia and completed the acquisition of Ventilairsec SA in France. Both acquisitions will be earnings enhancing and will report as part of Volution Group's Continental Europe sector. The deals are being funded from existing cash resources and the group borrowing facilities.

Homeware retailer Dunelm backed its pre-tax profit expectations for the full year on Thursday as it posted a 6% jump in third-quarter sales amid strong demand. The company said that after adjusting for the timing of the Winter sale, third-quarter sales rose 6% from the same period a year earlier to £423m. Sales in the year to date were 5% higher at £1.3bn.

Haleon posted first-quarter sales ahead of expectations on Thursday, boosted by a strong cold and flu season. The consumer healthcare giant said revenues in the three months to 31 March rose 9.9% on an organic basis, to £2.99bn, well above analyst forecasts, while prices increased by 7.1%. Growth was seen across oral health, pain relief and digestive health as well as respiratory health.

Metals miner Antofagasta held annual production guidance despite quarter-on-quarter falls in copper and gold output. Copper production fell by 25.4% compared with the final three months of 2022 to 145,900 tonnes, in line with guidance, and 5.1% higher year on year.

Transport operator National Express reported a rise in first-quarter revenues driven by an improvement in UK buses and German rail. Revenues rose 25% to £774.4m, in line with expectations, the company said on Wednesday, adding that its Spanish subsidiary ALSA reported strong growth, particularly in long haul and Morocco.

Commercial vehicle rental provider Redde Northgate said on Wednesday that full-year adjusted pre-tax profit was likely to be ahead of market consensus and around the top end of the consensus range following a continued strong performance across the business. Analysts are expecting adjusted pre-tax profit of £155.2m, and a range of £149.6m to £164.4m.

Customised electronics maker discoverIE Group on Wednesday lifted annual earnings guidance on the back of stronger sales and a healthy order book. Group sales for the year to March 31 rose 16% year-on-year, with fourth-quarter revenue up 8%, despite challenging comparators.

Outsourcing specialist Mitie said it expected operating profit to beat guidance after replacing all its Covid-related contract revenue, and announced a £50m share buyback. The company, which provides services from cleaning to building security, said it expected operating profit before other items to be at least £155m against current guidance of £145m and the actual £167m made in 2022.

Mining giant Anglo American has been given an environment permit for a $3bn extension of its Los Bronces copper project in Chile by a committee of government ministers. Anglo was initially rejected last May by the Environmental Assessment Service. The committee - made up of the ministries of mining, agriculture, energy, economy, and health and chaired by the environment ministry - is not part of the Chilean EAS but has the power to hear and review environmental resolutions.

Ladbrokes owner Entain hailed a "strong" start to 2023 on Tuesday, as it posted a jump in first-quarter net gaming revenue (NGR) amid record levels of active customers. In the period from 1 January to the end of March, NGR rose 15%, with continuing momentum across operations around the world. Meanwhile, online NGR was up 16%, in line with expectations.

UK cinema chain Cineworld has pulled the planned sale of its businesses in Eastern Europe and Israel, after the proposals it received did not meet the value needed by its lenders. The move follows Cineworld’s decision earlier this month to scrap the planned sale of its US, UK and Ireland businesses after failing to find a buyer. It filed a reorganisation plan to cut debt by about $4.53bn raise $2.26bn in funds to emerge from bankruptcy.

Recruitment company PageGroup on Monday maintained guidance as it reported a 2.4% decline in first quarter profits, driven by sharp falls in the US and Asia as potential staff declined firm job offers and clients delayed hiring decisions. The company posted gross profit of £262.7m on a constant currency basis, in actual terms a foreign exchange tailwind helped profits to rise by 1.8%.

Quiz shares slid on Monday after the fashion retailer struck a cautious note on the outlook, warning that inflationary pressures were denting consumer demand. In an update for the year to the end of March 2023, the company said it expects to report a 17% jump in revenues to £91.7m.

British defence group Qinetiq on Monday lifted annual guidance and said profits would come at the upper end of expectations driven by order growth across its major markets. The company now expects underlying operating profit of at least £175m, higher than the £166m consensus forecasts.

Ashmore posted an uptick in third-quarter assets under management on Monday thanks to a positive investment performance, with outflows reducing. In the quarter to the end of March, AuM rose by $0.5bn to $57.7bn. This comprised a positive investment performance of $1.6bn and net outflows of $1.1bn.

Economic news

A longstanding scuffle between Royal Mail and the Communications Workers Union (CWU) looked set to be coming to an end on Friday, with International Distributions Services announcing that it had reached an agreement with the CWU’s Postal Executive Committee. The FTSE 250 company said the deal would now be put to a ballot of the union's membership, with a recommendation to approve.

Aviva said on Friday that it was quitting the CBI as the crisis engulfing the UK business lobby group deepened. In a brief statement, the insurer said: "In light of the very serious allegations made, and the CBI’s handling of the process and response, we believe the CBI is no longer able to fulfil its core function - to be a representative voice of business in the UK.

Output in the UK’s private sector grew in April at the fastest pace in a year, according to a survey released on Friday. The S&P Global/CIPS flash composite purchasing managers’ index - which measures activity in the manufacturing and services sectors - rose to 53.9 from 52.2 in March. This marked the strongest growth in a year and was ahead of expectations for a reading of 52.5.

Retail sales fell by more than expected in March, official data showed on Friday, after the wet weather kept shoppers at home. According to the Office for National Statistics, retail sales volumes fell by 0.9% in March, following a downwardly-revised increase of 1.1% in February. Most analysts had been looking for a 0.5% decline.

UK consumer confidence strengthened in April, a long-running survey showed on Friday, despite soaring food prices and inflation. GfK’s latest consumer confidence index was -30, a six-point improvement on March and the highest since February 2022, when it was -26.

Economists at Citi reaffirmed its view that interest rates in the UK were more likely than not to peak during the second quarter of 2023 and for a cut in the last three months of the year. However, following the latest inflation surprise on Thursday morning and the rise in wages reported the day before, they judged that they had been too optimistic on the speed at which rate-setters would be able to pause.

Pharmaceuticals giant GSK is set to face a series of walkouts throughout May, it emerged on Wednesday, as hundreds of its workers who are members of the Unite union voted for strike action over a pay dispute. The union said 750 workers rejected GSK's offer of a 6% pay increase and a one-off lump sum of £1,300, which remained significantly below what it described as the current true inflation rate of 13.5%.

House price growth slowed in February for the third consecutive month, official data showed on Wednesday. According to the Office for National Statistics, average UK house prices increased by 5.5% in the 12 months to February, down on January’s upwardly-revised growth of 6.5%, although it was ahead of consensus, for 5.1% growth.

UK inflation declined by less than expected last month, official data showed on Wednesday, as record food prices continued to mount. According to the Office for National Statistics, consumer price inflation was 10.1% in the year to March, down from February’s surprise 10.4%. Economists were expecting a fall to 9.8%.

The UK unemployment rate ticked higher in the three months to February, according to figures released on Tuesday by the Office for National Statistics. The unemployment rate nudged 0.1 percentage points higher to 3.8%. This was driven by people unemployed for up to six months, the ONS said. Analysts had been expecting the rate to be steady.

International events

The Eurozone economy strengthened in April, a closely-watched survey showed on Friday, bolstered by a resurgent service sector. The latest flash HCOB Composite PMI Output Index, compiled by S&P Global, was 54.4, up on March’s 53.7 and an 11-month high. It was also well above consensus expectations of 53.7.

The US labour market softened a tad more during the previous week. According to the US Department of Labor, in seasonally adjusted terms, initial unemployment claims edged up by 5,000 over the week ending on 15 April to reach 245,000.

Factory sector activity in the US mid-Atlantic region softened again unexpectedly in April, the results of a closely followed survey revealed. The Federal Reserve Bank of Philadelphia's regional manufacturing sector index declined from a reading of -23.2 for March to -31.3 in April.

China held key lending rates steady as expected on Thursday, with its one-year Loan Prime Rate (LPR) left at 3.65%, while the five-year LPR, used to determine mortgage rates, maintained at 4.30%. The LPR is decided by the central bank based on considerations taken from 18 designated commercial banks, and is in turn used as a benchmark by private banks in offering loans.

The Eurozone’s construction sector strengthened in February, official data showed on Wednesday. According to Eurostat, the statistical office of the European Union, seasonally-adjusted production in the construction sector increased by 2.3% in February, and by 2.0% across the wider bloc.

Eurozone inflation fell sharply in line with expectations in March to 6.9% from from 8.5% as energy prices fell, although core inflation rose slightly. Energy prices in the single currency bloc fell 0.9% year on year.

US homebuilding activity slowed roughly as expected last month, although they underlying details of the latest data were better. According to the Department of Commerce, in seasonally adjusted terms, housing starts dropped at a month-on-month pace of 0.8% in March to reach an annual rate of 1.420m (consensus: 1.405m).

Analysts' confidence in the German economy fell back unexpectedly in April, the results of a closely followed survey revealed. The ZEW institute's economic sentiment index fell from 13.0 points for March to 4.1 in April (consensus: 13.5).

Economic activity in the People's Republic of China accelerated by more than expected at the start of 2023, leading some economists to bump up their forecasts for full-year growth. According to the National Bureau of Statistics, over the first quarter, gross domestic product expacted at a 4.5% year-on-year pace Bloomberg: 4.0%).

Factory sector activity in the Federal Reserve Bank of New York's district improved sharply in April, the results of a survey revealed. The so-called Empire State index jumped from a reading of -24.6 in March to 10.8 for April, Dow Jones Newswires reported.

Reporting by staff and contributors for Sharecast.com.