NatWest Group today unveiled its first major acquisition since returning to private ownership.
The lender and Coutts owner has bought wealth manager and BestInvest owner Evelyn Partners for £2.7 billion.
The Nikkei 225 surged after the country’s decisive election result, while the FTSE 100 index opened higher.
FTSE 100 Live Monday
- NatWest buys wealth manager
- Japan stocks surge
- InPost £6.8bn takeover
Market update: NatWest falls on £2.7bn deal, FTSE 100 makes progress
10:09 , Graeme EvansNatWest shares today fell 4% as the lender’s biggest deal since returning to private hands got a cool response in an otherwise positive FTSE 100 index session.
The £2.7 billion acquisition of wealth manager Evelyn Partners combines £69 billion in assets under management with the £59 billion of Coutts owner NatWest.
The private equity-backed firm, which rebranded from Tilney Smith & Williamson in 2022, spans financial planning, discretionary investment management and direct-to-consumer platform BestInvest.
The deal means NatWest will pause share buybacks beyond today’s plans for a £750 million return of capital.
Shore Capital said this implied a £2 billion shortfall against City expectations for the next year.
The City bank added: “While expanding in wealth management is strategically logical, we remain cautious on the deal economics, which rely heavily on synergy delivery to justify the price.
“Moreover, the willingness to pursue an acquisition on these terms over buying back shares reflects management’s view of its own valuation.”
The shares fell 27p to 632.4p, while Lloyds Banking Group lost 2% or 1.75p to 105p. Barclays added 2.4p to 481.5p ahead of annual results tomorrow.
The FTSE 100 index benefited from Friday’s strong Wall Street handover after the Dow Jones Industrial Average closed above 50,000 for the first time and tech stocks rallied following volatility earlier in the week.
London’s top flight lifted 34.53 points to 10,404.28, with Rolls-Royce up 22p to 1251p after Bank of America reiterated its Buy recommendation ahead of annual results on 25 February. It has a price target of 1600p.
British Airways owner IAG also rose 2% alongside gains for stocks in the mining sector, including Glencore and Fresnillo.
Greggs shares fall after “fat jab” downgrade, FTSE 250 higher
09:15 , Graeme EvansBakery chain Greggs is the biggest faller in the FTSE 250 index after City bank Jefferies downgraded the stock amid fears over the impact of weight-loss jabs.
The shares dropped 5% or 80 to 1600p as Jefferies cut from Buy to Hold and lowered its price target from 2500p to 1610p.
It warned that increased use of weight-loss drugs such as Mounjaro and Wegovy could create an “enduring challenge” for Greggs and hamper growth, the Times reported.
The bank lowered its forecasts for like-for-like sales growth and profit margins.
Despite the downgrade, Jefferies said Greggs remained a high‑quality operator with strong brand equity, robust cash generation and “a still‑compelling long‑term rollout opportunity”.
The FTSE 250 index rose 118.80 points to 23,326.69, with the shares of Playtech and Plus500 the best performers after gains of 6%.
InPost agrees £6.8bn FedEx-backed takeover
08:51 , Graeme EvansParcel locker group InPost has agreed to be bought by a consortium led by delivery giant FedEx and private equity firm Advent for 7.8 billion euros (£6.8 billion).
The deal for Poland-headquartered InPost is 17.3% higher than Friday’s closing price in Amsterdam and 50% above its price prior to last month’s bid speculation.
The company will continue under the InPost brand as a standalone firm, with its founder and chief executive Rafat Brzoska remaining at the helm.
FTSE 100 higher, NatWest shares fall
08:09 , Graeme EvansNatWest shares have fallen 4% or 23.4p to 636p after the lender unveiled the £2.7 billion acquisition of Evelyn Partners.
Lloyds Banking Group fell 23% or 2.1p to 104.7p but Barclays edged 0.6p higher to 479.75p ahead of its annual results tomorrow.
The FTSE 100 index has risen 20.77 points to 10,390.52, with Glencore among stronger mining stocks following a 2% improvement.
The UK’s ten-year gilt yield rose 0.5% to 4.539% amid the heightened uncertainty over Keir Starmer’s future as prime minister.
Week ahead: Barclays and Astra results, UK GDP figures
08:01 , Graeme EvansThe week ahead includes tomorrow’s release of annual results by BP, AstraZeneca and Barclays, followed by NatWest’s full-year figures on Friday.
Fellow FTSE 100 heavyweight stocks British American Tobacco and LexisNexis post their results on Thursday.
On the same day, the performance of the UK economy at the end of 2025 will be in the spotlight with GDP figures for December and the fourth quarter.
Bank of America expects an unchanged quarter-on-quarter performance at 0.1%, with a 0.1% month-on-month contraction in December.
In the US, economic highlights include Wednesday’s labour market report and Friday’s monthly inflation release.
Read more: What will Barclays and NatWest earnings show about the booming banking sector?
Nikkei 225 hits record after landslide election win
07:51 , Graeme EvansThe Nikkei 225 today closed 3.9% higher at a new record close after prime minister Takaichi secured a landslide victory in yesterday’s general election.
Deutsche Bank said: “Clearly a big victory was expected but this is probably even more impressive. The "supermajority" has raised the prospects of even more aggressive policy, including fiscal plans.”
Bond yields rose as IG said the decisive election win opened the door to debt-funded fiscal stimulus and reflationary policies.
It added: “Expectations of heavier government borrowing pushed Japanese two-year yields to around 1.3%, their highest since the mid-1990s, highlighting tension between growth optimism and fiscal sustainability.”
Pound and gilts in focus amid Starmer pressure
07:38 , Graeme EvansGilt yields and the pound will be in focus today as uncertainty over Keir Starmer’s political future continues to build following the exit of his chief of staff.
The pound was today slightly lower against the dollar at $1.36, having fallen in the past week from above $1.37 as traders weigh up the scenarios for the economy and financial markets should Starmer and Chancellor Rachel Reeves make way.
Capital Economics said today: “There are, in our view, plenty of hawkish-enough candidates in the Labour Party who could maintain the status quo with regards to fiscal policy.
“But fiscal probity is far from guaranteed and backsliding is a genuine possibility.
“Our sense is that the risk of that would probably mean an adverse reaction in gilts and the pound in the near term, even if a new leadership team were eventually able to restore investors’ trust.”
NatWest buys Evelyn Partners, unveils £750m buyback
07:11 , Graeme EvansNatWest today boosted its position in wealth management with the acquisition of Evelyn Partners in a deal valued at £2.7 billion.
The private equity-backed business has £69 billion of assets under management or administration and includes the direct-to-consumer platform BestInvest. Coutts owner NatWest has £59 billion of assets under management.
NatWest chief executive Paul Thwaite said: “At a time when the benefits of saving and investing are increasingly part of the national conversation, we can help customers to make more of their money through a broader range of services, as well as helping to drive growth and investment across the economy.”
The lender has also announced a share buyback of £750 million, which it said continued its strong track record of capital return to shareholders.
FTSE 100 seen higher, Nikkei surges 4%
07:00 , Graeme EvansJapan's Nikkei 225 today rose by 4% to set a new record after prime minister Takaichi secured a landslide victory in yesterday’s general election.
The FTSE 100 Index is seen opening about 0.4% higher, having ended a choppy week 0.6% or 60.53 points higher at 10,369.74.
A recovery for tech stocks on Friday meant the S&P 500 index rose 2% to 6932.30 and the Nasdaq Composite lifted 2.2%.
The Dow Jones Industrial Average closed up 2.5% to finish above 50,000 for the first time, while Bitcoin rallied from its October 2024 low to stand near $60,000.
The pound is flat at $1.36 amid heightened political uncertainty, while gold is back above $5000 an ounce.
