MARKET REPORT
SHARES in Royal Bank of Scotland soared yesterday after the Government slammed the brakes on the bank’s sale of Williams & Glyn (W&G).
RBS jumped more than 6%, or 16.5p to 258.9p, following an announcement of the Treasury’s proposals late on Friday that outlined an alternative £750m plan to boost competition in the banking market in an attempt to appease officials in Brussels.
But while investors cheered the move, the wider FTSE 100 Index was flat, slipping 0.1 to 7,299.86 points.
The embattled bank is required to sell W&G as one of the conditions for the multibillion-pound bailout by the UK Government following the banking crisis, but has struggled to strike a deal.
The Treasury has been in talks with the European Commission (EC) for months about the situation and will now seek formal changes to the state aid commitments.
Across Europe, Germany’s Dax was up 0.6% and the Cac 40 in France rose marginally.
The price of oil climbed 0.7% to $56.21 a barrel, but rising output from US drilling rigs and high stockpiles kept a lid on gains.
On the currency markets, the pound was largely unmoved after an economic update on Britain’s manufacturing industry showed orders had reached a two-year high in February.
The Confederation of British Industry (CBI) industrial trends survey showed total order books improved further over the three months to February to a balance of 8%, rising from 5% in January and 0% in December.
Sterling was up 0.4% to 1.246 against the greenback and 0.4% higher versus the euro at 1.173.
In UK stocks, shares in Unilever slumped after US food giant Kraft Heinz called off its proposed 143 billion US dollar (£115 billion) mega-merger with the consumer goods firm.
The Anglo-Dutch firm dropped more than 6%, or 249p to 3,548p, following a statement on Sunday which said Kraft Heinz had “amicably agreed” to withdraw its proposal.
The biggest risers on the FTSE 100 Index were Royal Bank of Scotland, up 16.5p to 258.9p, Rolls-Royce Holdings, up 42p to 708p, Hammerson, up 24p to 588.5p, Antofagasta, up 21.5p to 858.5p.
The biggest fallers on the FTSE 100 Index were Unilever, down 249p to 3,548p, Pearson, down 26p to 642.5p, Mediclinic International, down 26p to 802p, and Capita, down 8p to 514p.