14th Mar 2025 16:51
(Alliance News) - Stock prices in London closed higher on Friday, as a possible US government shutdown hangs in the balance although in Germany, political parties have agreed a long-awaited spending deal.
The FTSE 100 index closed up 89.77 points, 1.1%, at 8,632.33. The FTSE 250 ended up 307.02 points, 1.6%, at 19,995.59, and the AIM All-Share closed up 7.59 points, 1.1%, at 687.05.
The Cboe UK 100 ended up 1.1% at 862.80, the Cboe UK 250 closed up 1.6% at 17,427.87, and the Cboe Small Companies ended up 1.4% at 15,570.01.
Melrose led the FTSE 100, gaining 6.4%. Sainsbury led the laggers, falling 7.8%.
Bakkavor led the FTSE 250, shooting up 17%. Greencore however lost 1.4%.
Bakkavor, a London-based 'fresh prepared' food maker, responded to a takeover approach by Dublin-based convenience food maker Greencore saying it concluded that the potential offer "significantly undervalued the company and its future prospects."
Earlier on Friday, Greencore said its revised offer was rejected by Bakkavor on Monday.
Greencore has until April 11 to announce an intention to make an offer for Bakkavor, or to announce it does not intend to make an offer.
The offer valued Bakkavor at 85 pence and 0.523 Greencore shares per Bakkavor share. In addition, Bakkavor shareholders would have retained the right to a final dividend of 4.8p per share.
Among small caps, Seraphim Space Investment Trust led with a 12% rise
The London-based space technology investor reported a 6.8% increase in its net asset value to GBP239.7 million in the six months to December 31, from GBP224.3 million a year prior. Its portfolio valuation rose 9.3% over the period to GBP216.3 million from GBP198.0 million.
Looking ahead, Chief Executive Mark Boggett said: "The next 12 months will be significantly influenced by the new US administration's policies, particularly concerning tariffs and European security". The transformation in defence spending along with revised procurement practices "will undoubtedly benefit 'new space' companies", he continued.
Artemis Resources was among AIM's biggest losers, down 8.2%.
The gold, copper and lithium-focused miner, with projects in Western Australia, said its pretax loss in the six months ended December 31 widened to AUD5.7 million, or USD3.6 million, from AUD1.8 million in 2023.
This was despite income for the six-month period, including finance income, rising to AUD257,100 from AUD37,940.
Artemis Resources was also hit by a AUD4.0 million impairment on its project and exploration expenditure, against a AUD20,353 impairment the year before.
Ethernity Networks was AIM's worst performer, falling 28%.
The Israel-based supplier of data processing semiconductor technology for networking appliances said it is looking to raise GBP88,750 through issuing 177.5 million shares at 0.05 pence each.
And outside the stock exchange, the executive chair of Shein has reportedly confirmed that the fashion firm wants to be listed on the stock market.
Donald Tang told The Times that the company wants to be "in the fish tank for everybody to examine in the public square".
He also told the newspaper that Shein wanted to "embrace the accountability and transparency of being a public company".
However, Tang did not confirm if London is the favoured destination, only saying: "London has super-high, very respectable regulatory standards. The prime minister has said that. Both parties have said that. And we admire that very much."
UK Chancellor Rachel Reeves meanwhile has doubled down on the need to reform the welfare system, insisting the UK government must "get a grip" on it.
The benefits system is "broken" and is "not working for anyone", the Chancellor said.
Backbench Labour MPs have made it known to ministers they are concerned proposals to reform the welfare system will harm vulnerable people claiming benefits with one, Richard Burgon, confronting Prime Minister Keir Starmer about the proposals in the House of Commons on Wednesday.
He told the Commons that disabled people are "frightened" as he urged Starmer to introduce a wealth tax instead of "making the poor and vulnerable pay".
In global news, G7 leaders have called for a ceasefire in Ukraine and the resumption of aid to Gaza.
Speaking after a meeting with counterparts in Canada, UK foreign secretary David Lammy said there would be a "detailed statement" from nations outlining a joint position on the crisis.
It came as Donald Trump said on Friday the US had "very good and productive" discussions with the Russian leader, claiming there was a "very good chance that this horrible, bloody war can finally come to an end."
Kyiv earlier this week backed proposals from Washington for a 30-day ceasefire to the conflict which White House envoy Steve Witkoff later presented to Putin directly in a meeting on Thursday. The Russian leader has claimed "the idea is correct, and we certainly support it" but appeared to indicate certain provisos would be required for the Kremlin to fully agree to the US-brokered plan.
The group of powerful democracies also "reaffirmed their support for the resumption of unhindered humanitarian aid into Gaza and for a permanent ceasefire".
This marked a possible shift in the US position under President Donald Trump, whose administration had not previously criticised Israel for blocking aid.
In European equities on Friday, the CAC 40 in Paris ended up 1.1%, while the DAX 40 in Frankfurt ended up 1.7%.
Germany's conservatives have agreed on a much-debated multibillion-euro financial package for defence and infrastructure with the centre-left Social Democrats, SPD, and the Green party, dpa learned on Friday.
The conservative bloc, comprised of the Christian Democrats, CDU, and its Bavarian sister party the Christian Social Union, CSU, had agreed in its coalition talks with the SPD to relax Germany's strict debt rules to enable military spending and to create a special EUR500 billion infrastructure fund.
However, the Greens had initially refused to back the plan, which would need their support to reach the necessary two-thirds majority in the Bundestag, the lower house of Germany's parliament.
Some EUR100 billion has been earmarked to help fight climate change as part of the massive EUR500-billion infrastructure package, dpa learned from party sources.
Also, the German military has established a new division for homeland security in light of increased threats since Russia's full-scale invasion of Ukraine.
The soldiers of the homeland security division are to protect infrastructure, secure the deployment of allied troops and provide assistance in the event of disasters.
The pound was quoted lower at USD1.2920 at the London equities close Friday, compared to USD1.2957 at the close on Thursday.
The euro stood at USD1.0879 at the European equities close Friday, slightly higher against USD1.0874 at the same time on Thursday.
Against the yen, the dollar was trading higher at JPY148.34 compared to JPY147.65 late Thursday.
Stocks in New York were higher at the London equities close, with the DJIA up 1.3%, the S&P 500 index up 1.7%, and the Nasdaq Composite up 2.2%.
Consumer confidence in the US declined sharply again in March, falling more than analysts had expected, according to a study Friday that cited economic turbulence now that Donald Trump is back in power.
An index measuring consumer confidence compiled by the University of Michigan fell to 57.9 in March, down from 64.7 a month earlier, weighed down by the seeming chaos of Trump's tariff policy and fears of high inflation.
That marked a drop of 10.5% in the index in one month and 27.1% over the past year. Analysts had expected a smaller decline, to 63.2, according to a survey published by MarketWatch.
"This is bad news. People who fear losing jobs pull back on discretionary spending," said Bill Adams, chief economist at Comerica bank.
"People who are afraid the economy is headed into a ditch won't buy new cars or houses, go out to eat, or go on vacations," he added.
The US Senate meanwhile appeared closer Friday to avoiding an economically damaging government funding shutdown after the Democrats' leader shied away from a major confrontation with Trump.
Ahead of the Friday midnight deadline, top Senate Democrat Chuck Schumer – who has long insisted that it is bad politics to shut down the government – said he would support the bill.
A Democratic blockade of the bill and the ensuing chaos of the entire US government temporarily being out of funds would be "a gift" to Trump, he said. However, Schumer has not explicitly told his troops which way to vote, leaving it unclear whether enough Democrats will join Republicans.
Many in the party argue that refusing to back the Republican bill funding the US government for another six months would be a chance for Democrats to demonstrate opposition to the Trump project. Republicans have a slim majority with 53 of the 100 senators, but need some Democratic support to reach the necessary 60 votes for getting their bill through.
Grassroots Democrats, angered by Elon Musk's attack on the federal bureaucracy, want their leaders to fight against Trump and Musk's Department of Government Efficiency.
But several top party figures have warned that a shutdown could play into Musk's hands, distracting from his most unpopular actions and making it easier for him to announce more layoffs.
'DOGE' aims to cut federal spending by USD1 trillion this year and claims to have made savings so far of more than USD100 billion, although verified cost savings amount to less than a tenth of that figure.
Brent oil was quoted slightly higher at USD70.32 a barrel at the London equities close Friday from USD70.13 late Thursday.
Gold was quoted higher at USD2,988.54 an ounce at the London equities close Friday against USD2,982.53 at the close on Thursday.
The yellow metal breached the USD3,000 mark for the first time in history on Friday as rising global trade war risk continued to fuel demand for safe-haven assets.
Gold has hit a series of all-time high records since Donald Trump won the US presidential election in November last year.
Bullion, also buoyed by central bank buying, has rallied 14% year to date, and it is up 38% over the last 12 months. The precious metal touched an intraday best of USD3,006 on Friday.
"We see uncertainty over trade and tariffs continuing to buoy gold prices - and if trade tensions intensify and we see more retaliatory measures, safe-haven demand for gold will continue," ING analysts said.
In Monday's UK corporate calendar, Diversified Energy, F&C Investment Trust and Phoenix Group Holdings release full-year results.
The economic calendar for Monday has, from the US, retail sales and the US New York empire state manufacturing index.
By Emma Curzon, Alliance News reporter
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