London open: Stocks rise ahead of PMIs; Sainsbury's surges on takeover speculation

At 0830 BST, the FTSE 100 was 0.7% firmer at 7,136.65.

Richard Hunter, head of markets at Interactive Investor, said: "Markets enter the new week with some renewed optimism, having ended the previous week’s tumultuous ride in positive fashion.

"Although volatility is likely to persist given lighter summer volumes, the weakness which the markets endured for the majority of the previous trading sessions tempted some investors to buy on the dips, with big tech in the US a notable investment destination.

"Amid a quiet week for company and economic updates, the Jackson Hole symposium in the US will take on extra significance, with investors focusing sharply on any comments from the Federal Reserve on its current policy. The more recent economic numbers emanating from the US have suggested that the Fed has some additional breathing space before tapering begins, given the mixed messages which the data has provided.

"Even so, any variance from the message will unsettle investors, whether that be in terms of the timeline for the withdrawal of tapering or a more hawkish view on inflationary trends."

On the macro front, Markit’s services and manufacturing PMIs for August are due at 0930 BST.

In equity markets, Sainsbury’s shares surged following a report that US private equity firm Apollo is considering a bid for the UK supermarket chain. According to The Sunday Times, Apollo is circling Sainsbury’s with a view to possibly launching bids of more than £7bn, after scouring the industry for takeover targets.

WPP gained after saying it had bought Satalia, a technology company offering artificial intelligence solutions for clients, for an undisclosed sum.

Mitie was also trading up after agreeing to sell its document management business to Swiss Post Solutions for £40m.

Budget airline easyJet flew higher after appointing former RBS CEO Stephen Hester as its new chairman.

Shaftesbury nudged higher as the West End property owner reported a recovery in rent collection and said footfall was also showing signs of improvement as shoppers returned after the easing of Covid restrictions.

In broker note action, education publisher Pearson was boosted by an upgrade to ‘overweight’ from ‘neutral’ at JPMorgan, while Pennon was hit by a downgrade to ‘underperform’ from ‘neutral’ at Credit Suisse

Market Movers

FTSE 100 (UKX) 7,136.65 0.69%
FTSE 250 (MCX) 23,853.23 0.43%
techMARK (TASX) 4,850.10 0.32%

FTSE 100 - Risers

Sainsbury (J) (SBRY) 313.00p 6.21%
Burberry Group (BRBY) 1,885.50p 3.32%
Prudential (PRU) 1,489.50p 2.41%
Glencore (GLEN) 316.85p 2.34%
Pearson (PSON) 772.60p 1.93%
Barclays (BARC) 182.18p 1.59%
International Consolidated Airlines Group SA (CDI) (IAG) 161.42p 1.57%
BP (BP.) 292.30p 1.55%
BHP Group (BHP) 2,217.00p 1.53%
Weir Group (WEIR) 1,647.50p 1.51%

FTSE 100 - Fallers

Pershing Square Holdings Ltd NPV (PSH) 2,500.00p -1.57%
BT Group (BT.A) 171.80p -0.92%
United Utilities Group (UU.) 1,076.50p -0.65%
Avast (AVST) 599.80p -0.46%
SSE (SSE) 1,659.00p -0.45%
Severn Trent (SVT) 2,850.00p -0.25%
Smith & Nephew (SN.) 1,423.00p -0.14%
National Grid (NG.) 978.20p -0.08%
Informa (INF) 530.60p -0.08%
Rio Tinto (RIO) 5,227.00p 0.02%

FTSE 250 - Risers

Babcock International Group (BAB) 374.50p 5.31%
Tullow Oil (TLW) 42.57p 2.80%
PureTech Health (PRTC) 338.00p 2.58%
Ibstock (IBST) 232.60p 2.56%
Hilton Food Group (HFG) 1,186.00p 2.42%
Hochschild Mining (HOC) 148.80p 2.34%
Harbour Energy (HBR) 324.40p 2.33%
Volution Group (FAN) 530.00p 2.32%
Auction Technology Group (ATG) 1,454.00p 1.96%
Aston Martin Lagonda Global Holdings (AML) 1,952.00p 1.93%

FTSE 250 - Fallers

Pennon Group (PNN) 1,270.00p -3.20%
Chemring Group (CHG) 326.50p -2.83%
Templeton Emerging Markets Inv Trust (TEM) 176.60p -0.67%
Spire Healthcare Group (SPI) 229.00p -0.65%
Aberforth Smaller Companies Trust (ASL) 1,570.00p -0.63%
Diversified Energy Company (DEC) 106.80p -0.56%
Sanne Group (SNN) 934.00p -0.53%
Drax Group (DRX) 414.20p -0.53%
4Imprint Group (FOUR) 2,925.00p -0.51%
LXI Reit (LXI) 147.20p -0.41%