© Reuters. FILE PHOTO: The London Stock Exchange Group offices are seen in the City of London, Britain, December 29, 2017. REUTERS/Toby Melville/File Photo
By Devik Jain
(Reuters) – London’s FTSE 100 rose on Friday and was on track for its best week in a month, as hopes of a stronger economic recovery boosted commodity and industrial stocks, while Meggitt (LON:MGGT) shares soared on a takeover report.
The blue-chip index rose 0.3%, with Melrose Industries adding 2.6% after Morgan Stanley (NYSE:MS) raised its price target on the engineer’s shares.
Globally, investor sentiment was also bolstered by a batch of upbeat economic data from the United States and China amid concerns over surging coronavirus cases in parts of Asia. [MKTS/GLOB]
“This year is all about balance where we do want exposure to cyclical and value equities. The UK is a very good market to buy those, particularly given the fact on a forward earnings basis, it is still one of the cheapest globally,” said Edward Park, chief investment officer at Brooks Macdonald.
“There’s a degree of optimism now that is looking through some of the near-term uncertainty around COVID-19 and the market base case certainly is that as vaccination programmes roll out, the risk of COVID-19 reduces.”
The FTSE 100 has gained nearly 10% year-to-date as investors flocked to energy, materials and banking stocks that are seen benefiting the most from a stronger economic recovery due to speedy COVID-19 vaccine rollouts and government policy support.
The domestically focused mid-cap FTSE 250 index advanced 0.6%.
St. Modwen Properties surged 18.9% after it received a potential takeover offer from private-equity firm Blackstone (NYSE:BX), valuing the property developer at around 1.21 billion pounds ($1.68 billion).
Meggitt jumped 13.3% on report that U.S. group Woodward Inc was looking to acquire the UK aero-engineer.
Barclays (LON:BARC) gained 2% after activist investor Sherborne sold its 6% stake in the company, disbanding its efforts to overhaul the British bank.
FTSE 100 sees best week since April on recovery hopes; M&A chatter boosts Meggitt
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