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July 29, 2019, 12:01 p.m. EDT

British stocks enjoy best day in six months on pound collapse, merger buzz

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By Steve Goldstein, MarketWatch


Getty Images
Share price information is displayed on screens at the London Stock Exchange, which announced it may buy a financial data and infrastructure provider.

British stocks on Monday enjoyed their best single-day performance in six months as the pound collapsed on concerns the U.K. will leave the European Union without an agreed-upon deal.

/zigman2/quotes/210598409/delayed UKX 7,265.15, +42.33, +0.59%

The FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX +0.59%  rallied 1.82% to 7,686.61, the best gain of the major European stock markets. The pound tumbled through the $1.23 level to a two-year low as the new Boris Johnson government stepped up plans to leave the EU in a so-called no-deal Brexit.

Traders also flocked to bonds, as the yield on the benchmark 10-year Gilt /zigman2/quotes/211347177/realtime BX:TMBMKGB-10Y -2.10%  fell 4 basis points to 0.65%.

Read : British pound falls below key level, reaches new two-year low on no-deal Brexit concerns

The M&A news didn’t inspire the action across the Atlantic as U.S. stocks /zigman2/quotes/210598065/realtime DJIA +0.18% traded in a tight range. The U.S. Federal Reserve is due to cut interest rates on Wednesday, with the markets unsure whether the rate cut will be a quarter-point or a half-point.

In its first major deal since ex-Goldman Sachs executive David Schwimmer took the reins as CEO, the London Stock Exchange Group  said it’s in talks to buy Refinitiv, owned by Blackstone /zigman2/quotes/203156858/composite BX +1.41%   and Thomson Reuters /zigman2/quotes/203550191/composite TRI +0.08% , in a $27 billion deal to bulk up its offerings of financial data and infrastructure. LSE shares jumped nearly 15%.

Also read : Five things you need to know about the LSE-Refinitiv merger

Analysts at UBS, who rate LSE at neutral, said the deal would lift LSE earnings by 8% in its first year and by 20% in year three, excluding any refinancing benefits.

Just Eat jumped 23% to 780 pence after it and Takeaway.com /zigman2/quotes/201653805/delayed NL:TKWY -0.31%   announced merger talks, in a deal where the Dutch-listed group would buy the U.K.-listed company in a stock swap valuing Just Eat, using Friday’s closing prices, at 731 pence a share. Activist investor Cat Rock has stakes in both food delivery companies and has been reported to be pushing for a deal.

Heavyweight Vodafone Group /zigman2/quotes/202484985/delayed UK:VOD +1.61%   /zigman2/quotes/202862751/composite VOD +0.06%  extended last week’s gains from announcing it may sell its European towers business, with shares rising another 4.3% on Monday.

Ferguson shares /zigman2/quotes/209006722/delayed UK:FERG +1.40%   rose 2.3% as Sky News reported that Nelson Peltz’s Trian has urged the plumbing products distributor to sell its U.K. business.

/zigman2/quotes/210598409/delayed
UK : FTSE UK
7,265.15
+42.33 +0.59%
Volume: 144,523
Oct. 26, 2021 12:50p
loading...
/zigman2/quotes/211347177/realtime
add Add to watchlist BX:TMBMKGB-10Y
BX : Tullett Prebon
1.12
-0.02 -2.10%
Volume: 0.00
Oct. 26, 2021 1:04p
loading...
/zigman2/quotes/210598065/realtime
US : Dow Jones Global
35,741.15
+64.13 +0.18%
Volume: 270.41M
Oct. 25, 2021 5:26p
loading...
/zigman2/quotes/203156858/composite
US : U.S.: NYSE
$ 139.57
+1.94 +1.41%
Volume: 2.79M
Oct. 25, 2021 4:00p
P/E Ratio
19.16
Dividend Yield
2.56%
Market Cap
$165.00 billion
Rev. per Employee
$2.05M
loading...
/zigman2/quotes/203550191/composite
US : U.S.: NYSE
$ 119.00
+0.09 +0.08%
Volume: 357,189
Oct. 25, 2021 4:00p
P/E Ratio
8.57
Dividend Yield
1.36%
Market Cap
$59.03 billion
Rev. per Employee
$249,333
loading...
/zigman2/quotes/201653805/delayed
NL : Netherlands: Euronext Amsterdam
66.49
-0.21 -0.31%
Volume: 288,676
Oct. 26, 2021 1:50p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
€14.46 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/202484985/delayed
UK : U.K.: London
112.50 p
+1.78 +1.61%
Volume: 14.31M
Oct. 26, 2021 12:50p
P/E Ratio
592.11
Dividend Yield
6.95%
Market Cap
£30.41 billion
Rev. per Employee
£372,306
loading...
/zigman2/quotes/202862751/composite
US : U.S.: Nasdaq
$ 15.49
+0.01 +0.06%
Volume: 2.51M
Oct. 25, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
6.80%
Market Cap
$41.88 billion
Rev. per Employee
$486,182
loading...
/zigman2/quotes/209006722/delayed
UK : U.K.: London
10,900.00 p
+150.00 +1.40%
Volume: 49,654
Oct. 26, 2021 12:50p
P/E Ratio
17.88
Dividend Yield
1.60%
Market Cap
£23.92 billion
Rev. per Employee
N/A
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Steve Goldstein is MarketWatch markets editor for Europe. Follow him on Twitter: @MKTWgoldstein.

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