FTSE rises as investors bet on new offer for Ladbrokes owner Entain
Bets on a betting company helped push London’s top share index to a third day in the green on Wednesday.
nvestors took out bets on Entain, the owner of Ladbrokes, sending its shares soaring to the top of the FTSE 100.
It came as MGM Resorts, a US company which had previously wanted to buy Entain, sold 4.4 billion dollars (£3.2 billion) in assets, sparking speculation it might make a new bid for the UK firm.
MGM’s earlier 11 billion dollar (£7.9 billion) bid for Entain was rejected at the start of this year for being too low. Takeover rules had made MGM unable to table another bid for the company until last month.
Entain’s rise also lifted other UK gambling companies, including Flutter Entertainment, which rose by 6.1%.
Together they helped lift the FTSE 100 to a 0.3% gain. The index closed at 7,123.86 points, up 18.14.
The index was also boosted by a stronger-than-expected showing in the closely watched PMI economic survey for July.
“Despite some unwelcome data out of the eurozone and US, the UK has enjoyed a relatively upbeat day after a strong upward revision to the services PMI,” said Joshua Mahony, an analyst at IG.
“The UK’s reliance upon the hard-hit services sector saw the country experience one of the biggest downturns of any developed nation. However, with the UK reopening bringing an uptick in demand for the services sector, it is likely that we will also see growth receive a boost as we go forward.”
Sterling was flat against the dollar, buying 1.3905. Against the euro it rose 0.1% to 1.1745.
Wednesday also proved strong for other European markets. Germany’s Dax led the way with a 0.8% gain, while the Cac in Paris rose 0.3%.
Across the pond the S&P 500 dropped 0.5%, while the Dow Jones was trading down 0.9% as markets closed in London.
The value of Brent crude oil fell by around 2% to 70.92 dollars per barrel.
Headlines in London were dominated by Mike Ashley, whose Frasers Group will report results on Thursday morning.
The Telegraph reported that Mr Ashley might announce he is stepping down as chief executive of the company to become deputy chairman.
He could be replaced by his 31-year-old future son-in-law, the paper added.
However shareholders seemed largely unaffected by the report. Frasers’ shares closed up by just a quarter of a per cent.
Housebuilder Taylor Wimpey fared better on the market when it said it expects earnings to be higher than previously thought this year following a strong start.
The company completed a record 7,303 homes in the first half of 2021.
Shares in Taylor Wimpey closed up 1.9%.
The biggest risers on the FTSE 100 were Entain, up 110p to 1,912.5p, SSE, up 59p to 1,525p, Legal & General, up 7.7p to 271.5p, Abrdn, up 8.3p to 295p, and Scottish Mortgage Investment Trust, up 32p to 1,341.5p.
The biggest fallers on the FTSE 100 were Pearson, down 29.2p to 786.2p, United Utilities, down 27p to 811.4p, Just Eat Takeaway.com, down 149p to 6,242p, Ocado, down 39.5p to 1,800p, and Johnson Matthey, down 44p to 2,938p.