FTSE 100 rebounds on China optimism; THG surges after rejecting buyout bid

Published On : 05/20/2022

(Reuters) – UK’s FTSE 100 rebounded on Friday as a move by China to support its economy lifted sentiment at the end of a rocky week for markets, while e-commerce firm THG soared after rejecting a takeover proposal.

The blue-chip FTSE 100 index and the domestically focussed FTSE 250 index both added 1.4%, erasing nearly all of their weekly declines.

Oil and gas and banking stocks were the top boosts to the FTSE 100 after China cut a key lending benchmark by a sharper-than-expected 15 basis points to aid a slowing economy.

THG surged 25.6% as it rejected a takeover proposal from two investment groups and saw buyout interest from property tycoon Nick Candy.

Data earlier in the day showed British retail sales jumped unexpectedly in April, but the outlook for consumer spending remained resolutely downbeat as the cost-of-living crunch intensifies.

The unexpected upturn in retail sales could be viewed as a positive sign that the consumer isn’t as bruised as other data suggests,” AJ Bell financial analyst Danni Hewson said in a note.

But digging into April’s figures, the big uptick in food and drink spend in supermarkets might indicate that people are choosing their kitchen tables over pubs and restaurants as they look to save money.”

The domestically focussed midcap index has declined nearly 15% this year on fears that surging inflation could tip the economy into recession. The commodity-heavy FTSE 100 has fared better with a small rise so far in 2022, thanks to surging oil and metal prices.

The Bank of England will need to raise interest rates further to combat the risk of self-perpetuating price rises, its chief economist said in a speech.

Among other stocks, M&C Saatchi jumped 34.5% after its independent directors agreed a deal to sell the advertising company to consultancy Next Fifteen Communications, saying it offered a superior outcome to a bid from its biggest shareholder.

(Reporting by Sruthi Shankar in Bengaluru; Editing by Sherry Jacob-Phillips and Aditya Soni)

Wanda Rich

Wanda Rich has been the Editor-in-Chief of Global Banking & Finance Review since 2011, playing a pivotal role in shaping the publication’s content and direction. Under her leadership, the magazine has expanded its global reach and established itself as a trusted source of information and analysis across various financial sectors. She is known for conducting exclusive interviews with industry leaders and oversees the Global Banking & Finance Awards, which recognize innovation and leadership in finance. In addition to Global Banking & Finance Review, Wanda also serves as editor for numerous other platforms, including Asset Digest, Biz Dispatch, Blockchain Tribune, Business Express, Brands Journal, Companies Digest, Economy Standard, Entrepreneur Tribune, Finance Digest, Fintech Herald, Global Islamic Finance Magazine, International Releases, Online World News, Luxury Adviser, Palmbay Herald, Startup Observer, Technology Dispatch, Trading Herald, and Wealth Tribune.