Buyers targeted the engineering sector today after updates by Smiths Group, Babcock International and GKN Automotive business Dowlais.
The trio’s shares all surged by double-digit percentages in a session when the FTSE 100 steadied after recent heavy selling.
Blue-chip investors have also heard from Experian and SSE, while Just Eat Takeaway has sold Grubhub for a much cheaper price than it paid in 2020.
FTSE 100 Live Wednesday
- Smiths Group surges on new guidance
- Just Eat in $650m GrubHub sale
- SSE boss to step down
Market update: Smiths rebounds in FTSE 100, Just Eat up 21% after Grubhub deal
10:17 , Graeme EvansA resurgent Smiths Group led a robust FTSE 100 index today after the maker of airport scanners and satellite components gave a forecast-busting update.
The engineering conglomerate’s shares put back 14% or 218p to 1740p, having slumped from 1,820p in the aftermath of annual results in mid-September.
Ahead of its annual meeting in London, Smiths improved its guidance for annual revenue growth to 5-7% while it also strengthened its margin estimate.
Revenue growth was 15.8% for the three months to 1 November after a “particularly strong” result in Smiths Detection and a “stand-out” performance by Smiths Interconnect.
The company also increased its share buyback programme from £100 million to £150 million, having completed the first tranche of £50 million in September.
The improvement for Smiths came in a session when mining and retail stocks helped steady the FTSE 100 index following yesterday’s 1.2% reverse.
The top flight improved 30.46 points to 8056.23, with further progress likely to depend on how Wall Street views this afternoon’s US inflation reading.
AstraZeneca also helped the FTSE 100 performance as investors finally warmed to yesterday's improved guidance by sending shares up 3% or 282p to 10,272p.
Marks & Spencer shares lifted 6.4p to 371.6p as sentiment towards the retailer benefited in the aftermath of yesterday’s presentations to City analysts.
Shore Capital said the retailer’s management had given an “increasingly self-confident appraisal” of where the firm is and where it is going.
JD Sports Fashion also improved 2.65p to 119.9p and Rio Tinto lifted 54p to 4799p. On the fallers board, private equity firm Intermediate Capital Group lost 110p to 2130p as investors used half-year results to lock in recent gains.
Data and information group Experian also retreated 76p to 3786p despite enhancing its margin guidance in half-year results.
SSE rose 4.5 at 1705.5p, having posted in-line half-year results alongside an announcement that chief executive Alistair Phillips-Davies is to step down during 2025 after more than 11 years of leading the renewables firm.
In the FTSE 250, Babcock International rose 7% or 34.3p to 533.5p after half-year results signalled further progress in its turnaround.
Dowlais was the best mid-cap stock amid relief that the GKN Automotive business had left guidance unchanged in a trading update.
Shares rose 14% or 6.6p to 54.65p, although they remain about 50% lower this year due to challenging market conditions in China and elsewhere.
Other big movers today included Just Eat Takeaway, which jumped 21% or 199.2p 1140.2p after agreeing to sell Grubhub for $650 million.
The deal removes a cash drain on the Just Eat business, although the price tag is much lower than the $7 billion paid for the Chicago-based operator in 2020.
Inflation worries slow S&P 500 progress
09:24 , Graeme EvansWall Street’s post-election advance has slowed after traders turned their focus to this afternoon’s release of inflation figures for October.
The headline print is set to increase for the first time in seven months, up from 2.4% to as high as 2.6%. Growth in core prices is seen unchanged at 3.3%.
The S&P 500 index closed above 6000 for the first time on Monday as stocks benefit from the prospect of lower tax and deregulation in the Trump administration.
But with traders scaling back expectations for lower interest rates, the benchmark closed slightly lower last night and is expected to make a flat start this afternoon.
Smiths leads steady FTSE 100, automotive firm Dowlais up 16% in FTSE 250
08:46 , Graeme EvansThe FTSE 100 index is up 9.90 points to 8035.67, with miners and the retail sector helping London’s top flight in the wake of yesterday’s 1.2% decline.
Rio Tinto rose 34.5p to 4779.5p and Marks & Spencer improved by 3p to 368.2p, while AstraZeneca rallied 206p to 10,196p.
Engineering group Smiths is the best performing FTSE 100 stock, up 12% or 180p to 1702p after posting a strong first quarter update.
On the fallers board, Intermediate Capital Group gave up some of this year’s gains as shares reversed 5% or 102p to 2138p after half-year results.
The FTSE 250 index stands 91.34 points higher at 20,519.14, led by GKN Automotive business Dowlais after it reiterated guidance in interim results.
The shares jumped 16% or 7.6p to 55.6p, reducing this year’s fall to 48%. Babcock International also surged 13% or 64.8p 564p following half-year figures.
Babcock shares surge after strong first half
08:31 , Graeme EvansBabcock International shares are up 12% in the FTSE 250 index after results by the defence and aerospace engineering firm showed another six months of turnaround progress.
Half-year revenues of £2.4 billion increased 11% on an organic basis, driven by strong growth in the Nuclear and Land sectors. Underlying operating profit rose 10% to £168.8 million.
With around 90% of 2025’s expected revenue under contract at 1 October, Babcock said it started the second half with “good momentum”.
Chief executive David Lockwood said: “Working closely with our customers, we are consistently delivering key programmes and contracts, with enhanced standards of execution.
“Meanwhile, a backdrop of geopolitical instability means demand for what we do continues to increase, resulting in an expanding and attractive long-term opportunity set.
“We are selecting the right opportunities and are being disciplined in how we deploy capital to deliver growth which maximises shareholder value."
Shares rose 62.8p to 562p.
Smiths Group shares soar on new guidance and £150m buyback
08:11 , Graeme EvansShares in engineering conglomerate Smiths Group have jumped 16% after it upgraded guidance and increased its share buyback programme.
The company, which holds its AGM in London later today, has been boosted by a record order book and strong start to the financial year.
FTSE 100-listed Smiths, which operates four divisions including Smiths Detection, now expects revenue growth in the range of 5-7% compared with the original 4-6% guidance.
It also forecasts a 40-60 basis point expansion in operating profit margin in 2025, placing the company on a good trajectory towards its medium-term margin target.
Smiths has increased its share buyback programme from £100 million to £150 million, having completed the first tranche of £50 million in September.
Organic revenue growth was 15.8% for the three months to 1 November, with “particularly strong” growth in Smiths Detection and a “stand-out” performance by Smiths Interconnect.
John Crane and the Flex-Tek aerospace business also achieved growth in the period. The company said it benefited from strong trading in the US, which represents around 45% of revenue.
Shares rose 243p to 1765p.
Experian lifts margin outlook after half-year progress
07:49 , Graeme EvansExperian has improved its full-year guidance alongside interim results showing an 8% rise in benchmark earnings to one billion US dollars (£780 million).
The FTSE 100-listed data and information group lifted its margin outlook towards the upper end of its previous guidance. It continues to see annual revenues growth of between 6% and 8%.
Chief executive Brian Cassin said the company delivered “good growth” in the first six months of the financial year.
He added: “We continue to execute successfully on our growth strategy to introduce new products, deploy advanced analytics and scale our leading platforms.”
Just Eat Takeaway strikes GrubHub deal
07:27 , Graeme EvansJust Eat Takeaway.com today announced a deal to sell Chicago-based Grubhub, the food delivery business it bought for $7 billion in 2020.
The agreement with Wonder Group gives GrubHub an enterprise value of 650 million US dollars (£510.6 million). The deal is due to complete early 2025.
CEO and founder Jitse Groen said the sale will increase JustEat’s cash generation capabilities and help to accelerate its growth.
In 2023, GrubHub recorded negative cash flow of 77 million euros (£64 million) after handling 237 million orders with a value of eight billion euros (£6.7 billion)
He added: “This deal delivers the right home for Grubhub and its employees.”
SSE boss to step down, profits rise
07:06 , Graeme EvansSSE today said chief executive Alistair Phillips-Davies is to step down during 2025 after more than 11 years of leading the renewables firm.
The announcement came alongside interim results, which showed a 26% rise in half-year profits to £714.5 million. Expectations are unchanged for the full year.
Phillips-Davies said: "This is a strong set of interim results including delivery of higher-quality earnings and the mission-critical infrastructure that shows SSE is at the heart of the clean energy transition.”
Index steady but US momentum slows, Bitcoin at $86,600
07:00 , Graeme EvansThe post-election rally for US markets showed signs of easing last night after the Dow Jones Industrial Average closed 0.9% lower.
The S&P 500 index slipped 0.3% to finish below Monday’s record at over 6000 while the Nasdaq Composite dipped 0.1%.
Bitcoin is currently at $86610, down from $89,000 earlier this week.
The FTSE 100 index is seen opening eight points higher at 8034, having fallen 1.2% to a three-month low in yesterday’s session.
