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London pre-open: Stocks to edge up as oil prices rally

By Michele Maatouk

Date: Monday 20 Jan 2020

London pre-open: Stocks to edge up as oil prices rally

(Sharecast News) - London stocks were set to edge up the open on Monday as oil prices rallied, but the session was expected to be fairly quiet, with US markets out of action.
The FTSE 100 was called to open eight points higher at 7,682.

London Capital Group analyst Jasper Lawler said: "European shares are set to open higher on Monday in what may be a more muted day of trading with Wall Street closed for Martin Luther King Jr. Day. Trading in Asia was light with US investors on holiday today and Chinese New Year celebrations set to begin on Friday.

"A jump in the price of oil looks like it will give the FTSE 100, home to BP and Shell an extra boost. The UK benchmark index has reached its highest since July last year, benefiting from a weaker pound since most companies earn the majority of their money abroad. British home builder and estate agent shares could benefit from data by Rightmove showing home asking prices jumped by a seasonal record, attributing it to a 'release of pent up demand'. Winter time right before Christmas is typically dead but the election result looks like it changed that norm for UK home buyers."

Oil prices surged following news that armed forced shut down production in one of Libya's largest oil fields.

In UK corporate news, BAE Systems said it was buying Collins Aerospace's Military Global Positioning System business for $1.925bn (£1.48bn) and Raytheon's Airborne Tactical Radios business for $275m.

The company said that the Collins purchase would produce a $365m tax benefit and the Raytheon deal $50m.

Anglo American and Sirius Minerals have reached agreement on the terms of a recommended cash acquisition under which Anglo American Projects UK will acquire Sirius via a scheme of arrangement.

The companies said that, under the terms of the acquisition, Sirius shareholders would receive 5.5p in cash for each Sirius share held.

Anglo American said the offer price represented a premium of 34.1% to the closing price on 7 January, and valued the entire issued and to-be-issued share capital of Sirius at about £404.9m.

AstraZeneca announced that 'Imfinzi' (durvalumab) and tremelimumab, an anti-CTLA4 antibody and potential new medicine, have both been granted 'orphan drug designation' by the Food and Drug Administration (FDA) in the United States for the treatment of hepatocellular carcinoma - the most common type of liver cancer.

At the same time, the FTSE 100 pharmaceuticals giant and its partner MSD said that a supplemental new drug application for 'Lynparza' (olaparib) has been accepted and granted priority review in the US, for patients with metastatic castration-resistant prostate cancer and deleterious or suspected deleterious germline or somatic homologous recombination repair gene mutations, who had progressed following prior treatment with a new hormonal agent.

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