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New bid for Misys as gilts sell-off halts and FTSE pulls back
UK government bonds regain some ground and the FTSE 100 slips a further 32 points as investors await more signs on the direction of the global economy. Banking software provider Misys (MSY.L) receives a new bid.
(Update - adds Premier Foods and oil exploration companies) A sell-off in UK gilts and other perceived ‘safe haven’ government bonds halted on Monday, as investors awaited further signals on the direction of the global economy, while Britain’s FTSE 100 retreated.
The yield, or implied interest rate, on benchmark 10-year gilts pulled back one basis point to 2.43%, after hitting a three-month high of 2.49% on Friday. The yields on German bunds and US Treasuries also fell back, after investors dumped the debt last week amid hopes that the global economic recovery was finally on track.
‘Last week’s sell-off across the major coupon curves was not justified by any major change in the global economic scenario,’ said Annalisa Piazza, analyst at Newedge Strategy.
‘However, the risk-on mood might continue to prevail in the coming weeks, with no major data likely to “challenge” the slight recovery scenario the market is currently pricing in.’
The UK index of blue-chip shares dropped 0.52%, or 32 points, to 5,935 and the All Share index softened 0.48%, or 15 points, to 3,083. See the FTSE’s performance and the index’s top winners and losers.
Banks were among the biggest fallers, amid losses by rivals in Europe and as accountancy firm KPMG warned that Britain’s lenders would face further pressure on profits in part due to the mounting costs of regulation.
New bid for Misys
On the FTSE 250, Misys (MSY.L) jumped 23p to 352p after the software group told its largest shareholder and possible suitor ValueAct that a 350p-a-share deal it had agreed with private-equity firm Vista Partners was likely to be the best available.
Mysis also reported a 3% drop in revenue for the year to the end of the third quarter, as its order intake fell 5%.
‘We believe this is at the lower end of expectations but market conditions remain tough and an accompanying Q3 update showing deterioration in trading is a good reminder of that,’ said analysts at Singer Capital Markets of the 350p takeover offer.
Premier Foods strikes deal
Premier Foods (PFD.L) fell 4.7% or 0.5p to 11.4 p after full-year profits fell 29% and the company, which owns brands such as Hovis, Mr Kipling and Batchelors, said it expected trading to remain challenging.
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Look up the shares
- Standard Chartered PLC
- Lloyds Banking Group PLC
- Barclays PLC
- BT Group PLC
- Misys PLC
- Premier Foods PLC (PFD.L)
- Xcite Energy Ltd (XELL.L)
- President Petroleum Co PLC (PPTC.L)
- Trap Oil Group PLC (TRAPO.L)
- Cadogan Petroleum PLC (CADP.L)
- Nostra Terra Oil and Gas Company PLC (NTOG.L)
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