Reckitt Benckiser deal helps boost FTSE 100 Index
The FTSE 100 pushed higher on Wednesday, helped by news that Reckitt Benckiser had agreed to sell a basket of its key food brands in a multibillion-pound deal.
London's blue chip index ended the day higher by 0.55% or 40.69 points at 7,430.91, with Reckitt shares ranking among the best performers, up 125p at 7,937p.
The household goods giant confirmed it would sell a raft of brands including French's mustard and Frank's hot sauces to McCormick in a 4.2 billion US dollar (£3.2 billion) deal.
US group McCormick fought off a number of rival bidders to secure the British firm's food business in a move that will propel it to the number one position in America's condiments market.
David Madden, a market analyst at CMC Markets UK, explained that the funds raised through the deal will help pay down Reckitt's debt, which seemed to please shareholders.
"The company's shares are higher on the day as investors are clearly happy with the deal."
In currency markets, sterling was relatively flat against the US dollar, down 0.08% at 1.302, but rose around 0.3% versus the euro to 1.131.
Across Europe, the French Cac 40 and German Dax ended the day up 0.83% and 0.17% respectively.
In oil markets, Brent crude prices jumped nearly 1.4% to 49.35 US dollars per barrel, after data from the Energy Information Administration showed a bigger-than-expected drop in US energy inventories.
In UK stocks, Royal Mail was the biggest faller on the London market following a heady rise on Tuesday when it revealed that it had narrowed the decline in letter deliveries thanks to a boost from general election political mailings.
The group said total letter revenues fell by a better-than-expected 4% in the three months to June 25 after the snap election that month.
It also confirmed on Wednesday that easyJet had appointed Royal Mail boss Moya Greene to its board earlier than planned as it speeds up the search for a new chief executive.
Shares were down more than 2%, or 11.3p to 399.8p.
Away from the top tier, construction giant Morgan Sindall raced ahead after announcing it was on course for a hefty jump in profit thanks to a bright performance from its interior refurbishment business.
Pre-tax profits are expected to rise by 45% to £23.5 million for the six months ending in June, boosted by better-than-expected trading from its Fit Out unit, which overhauls office and retail space.
The firm, which has revenues of £2.6 billion and employs around 6,000 staff, was also helped by improved margins at its construction and infrastructure arm.
Shares climbed more than 4%, or 55p to 1275p.
The best performers on the FTSE 100 were Sage Group up 18p to 690p, Barratt Developments up 14.5p to 609.5p, Persimmon up 56p to 2,442p, and Intertek Group up 99p to 4,329p.
The worst performing stocks on the FTSE 100 were Royal Mail down 11.3p to 399.8p, Paddy Power Betfair down 160p to 7,610p, Kingfisher down 4.9p to 297.1p, and Mediclinic International down 12p to 733p.