Monday 25 June 2018

French M&A flurry lifts Europe's markets

Traders work on the floor of the New York Stock Exchange (NYSE)
Traders work on the floor of the New York Stock Exchange (NYSE)


Mergers and acquisitions dominated European share trading yesterday, while strength in oil stocks after a pipeline shutdown helped lift a key regional benchmark index to five-week highs.

The pan-European STOXX 600 index climbed 0.7pc to its highest level in a month, while eurozone blue chip stocks rose 0.4pc, helped by a late drop in the euro.

In Dublin the Iseq was down slightly at 7020.84.

Gemalto surged 34.6pc after French tech consultancy Atos tabled an all-cash bid valuing the Dutch cybersecurity company at €4.3bn.

Gemalto shares, which have been dented by four profit warnings in a year, led gainers on the STOXX on Tuesday and helped the tech sector bounce 1.7pc.

In other deal-driven moves, Unibail-Rodamco declined 4.1pc after the French commercial real estate group offered to buy shopping mall owner Westfield Corp for $16bn.

"Year ends with M&A boom on French market," wrote Kepler Cheuvreux analysts.

"While the acquisition of Gemalto is not the straightforward one we expected, Atos's management has a strong track record for turning around companies," they added.

Unibail's acquisition of Westfield would help it "finally" get US and UK exposure, Kepler said.

Oil stocks rallied after oil prices rose above $65 a barrel for the first time since mid-2015 following a shutdown of the UK's biggest North Sea oil pipeline.

The oil and gas sector, which has been the worst-performing this year, jumped 1.6pc.

The sector has been hit by a pipeline leak in a key North Sea oil field, and a fatal fire affecting Austria's gas infrastructure.

Irish Independent

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