London midday: FTSE little changed as property stocks rally, defence firms dip

(Sharecast News) - London stocks were still just a touch higher by midday on Wednesday, with property names lending support on news of a takeover bid for Segro but an overall sense that markets were struggling for direction.

The FTSE 100 was up 0.1% at 10,440.75.

Susannah Streeter, chief investment strategist at Wealth Club, said: "The global tech sell-off appears to have started to stabilise, but investors remain super-cautious, nervous that high valuations could be chipped away at again. Even a fresh easing of the energy crunch, with oil prices dipping further, isn't lifting sentiment much.

"The Footsie has had a flat start with investors searching for a sense of direction. Losses are still being nursed from the big tech names who've sucked up investors' savings this year."

On the political front, speculation was growing over who might replace chancellor Rachel Reeves if Andy Burnham becomes prime minister, with Wes Streeting seen as the frontrunner. Sterling was down 0.4% against the dollar at 1.3157.

"From any new Chancellor, financial markets would initially be looking for stability and signs of action aimed at stimulating sustainable growth, and Streeting is likely to initially try to project reassurance and a business as usual attitude aimed at reassuring investors and keeping a lid on high government borrowing costs," said Streeter.

Meanwhile, the US and Iran were offering conflicting accounts of their nuclear discussions.

According to the New York Times, President Trump said Iran had agreed to the "highest level" inspections, hours after an Iranian official said there were "no detailed discussions on the nuclear issue", as the two sides continued to present different narratives of their latest talks.

Oil prices were lower, with Brent crude down 1.6% at $75.87 a barrel and West Texas Intermediate also off 1.6%, at $72.03.

"With tanker traffic rising through the key Strait of Hormuz and big oil-producing nations increasing output, it's lifting hopes that energy shortages will be eased more quickly," said Streeter. "However, economies still won't have felt the full effects of the surge in prices in the Spring feeding through. There are also concerns that tolls could be imposed on the Strait of Hormuz, given that Iran and Oman are in discussions about how to manage the waterway going forward. This would add to shipping costs for the longer term and add to pressures for importers."

In equity markets, Segro surged to the top of the FTSE 100 after rebuffing a �12.6bn takeover approach from US real estate giant Prologis. Land Securities, British Land, LondonMetric, Great Portland Estates, Tritax Big Box and Big Yellow all rallied on the news.

Dan Coatsworth, head of markets at AJ Bell, said: "Prologis urging shareholders to encourage Segro to engage suggests the initial all-share bid submitted last week is just its opening salvo and that Segro's rejection won't be the final word in the story.

"Whether an all-share bid will prove attractive to shareholders, given it would mean ending up with an investment in a much different entity, is open to question. Perhaps including a cash element would help smooth the passage of any deal.

"A chunkier premium may also be required. Should Prologis succeed with its pursuit, it would represent yet another large-cap loss from the UK market and a diminution in its breadth and quality."

Housebuilder Berkeley was a high riser as it posted a drop in full-year pre-tax profit in line with guidance, and net cash comfortably ahead.

Primary Health Properties gained after confirming it was in advanced talks with an unnamed investor on the potential formation of a joint venture involving its private hospital portfolio.

Retailer B&M European Value Retail rose as it appointed Atheeq Akbar as its next chief financial officer, with the former Asda executive set to join the group in February 2027.

On the downside, defence firms BAE Systems and Babcock fell on reports that Germany plans to scrap a multibillion-euro project to build the biggest warship commissioned by the navy since the second world war.

Gamma Communications slid after Providence Equity Partners said it does not plan to make an offer for the telecommunications services firm. Providence had been part of a consortium with Epiris.

Rail travel platform Trainline slumped as it appointed Ian Brown as its next chief executive officer with effect from 28 September, succeeding Jody Ford. Brown was most recently CEO of the UK & Ireland division of Flutter Entertainment.

Market Movers

FTSE 100 (UKX) 10,440.75 0.11%

FTSE 250 (MCX) 22,954.56 0.12%

techMARK (TASX) 5,795.59 0.21%

FTSE 100 - Risers

SEGRO (SGRO) 875.60p 17.92%

Games Workshop Group (GAW) 21,200.00p 4.33%

Croda International (CRDA) 3,192.00p 3.57%

British Land Company (BLND) 415.80p 3.54%

St James's Place (STJ) 1,187.00p 3.49%

Whitbread (WTB) 2,530.00p 3.33%

Land Securities Group (LAND) 642.00p 3.28%

Persimmon (PSN) 1,063.50p 3.05%

Haleon (HLN) 343.20p 2.79%

LondonMetric Property (LMP) 187.50p 2.73%

FTSE 100 - Fallers

Airtel Africa (AAF) 334.20p -4.43%

London Stock Exchange Group (LSEG) 8,162.00p -2.32%

Flutter Entertainment (DI) (FLTR) 7,412.00p -2.19%

Prudential (PRU) 992.00p -2.13%

Lion Finance Group (BGEO) 11,280.00p -2.09%

Glencore (GLEN) 525.30p -1.72%

BP (BP.) 490.40p -1.69%

Fresnillo (FRES) 2,798.00p -1.61%

BAE Systems (BA.) 1,798.00p -1.48%

BT Group (BT.A) 194.40p -1.44%

FTSE 250 - Risers

Tritax Big Box Reit (BBOX) 161.50p 6.39%

SDCL Efficiency Income Trust (SEIT) 33.85p 5.78%

Harworth Group (HWG) 127.40p 5.64%

B&M European Value Retail (BME) 195.00p 4.77%

Safestore Holdings (SAFE) 607.50p 4.30%

Berkeley Group Holdings (The) (BKG) 3,606.00p 4.22%

Big Yellow Group (BYG) 891.50p 3.60%

Hammerson (HMSO) 362.00p 3.37%

WH Smith (SMWH) 396.20p 3.34%

Great Portland Estates (GPE) 324.60p 3.18%

FTSE 250 - Fallers

Gamma Communications (GAMA) 807.50p -8.24%

Raspberry PI Holdings (RPI) 727.00p -4.61%

Hochschild Mining (HOC) 496.40p -3.76%

Partners Group Private Equity Limited. (EUR) (PEY) 7.72p -3.50%

WPP (WPP) 253.90p -3.42%

Ceres Power Holdings (CWR) 589.00p -3.28%

Chemring Group (CHG) 482.40p -3.22%

Seraphim Space Investment Trust (SSIT) 180.80p -2.90%

Diversified Energy Company (DI) (DEC) 971.00p -2.90%

Playtech (PTEC) 299.20p -2.86%