Market Report: National Express looking attractive for a takeover

With a woeful August for the City finishing on a high yesterday, analysts were on the hunt for the next big takeover deal as a number of stocks on the mid-tier index had their bid potential talked up.

Among them was National Express, which was lifted 16.4p to 250.8p after UBS said the transport group was the "most likely and attractive" target in the sector. The broker highlighted "its diversified business mix, its valuation versus peers and deal economics, and the presence of deal-friendly shareholders", and put forward Stagecoach – up 1p to 257.2p – as one potential aggressor.

Analysts from UBS also suggested Go-Ahead could become a target, saying it may be the "easiest exposure for an international player looking to get into the UK bus and rail market". The group still had its rating cut to "sell", however, thanks in part to its higher valuation, yet it climbed 64p to 1,583p.

Another having its takeover hopes raised was Spirit, the pubs group which was spun out of Punch Taverns at the start of August. The company powered up 2p to 43.5p after Numis Securities said the sector "may have to use expansion and acquisitions to offset rising cost pressure" and that as a result Spirit "could become a bid target".

There was less optimism over the likelihood of deals among the asset managers, despite Citigroup saying the current subdued outlook would "usually stimulate merger and acquisition activity". However, the broker warned the companies under its coverage were "more likely to be consolidators than targets" and that anyone interested in the two possible exceptions – Ashmore (up 19.9p to 404.4p) and Jupiter Fund Management (up 2.2p to 192p) – would have to tackle "significant blocking stake shareholdings".

Vague takeover rumours continued to do the rounds on a number of companies, including Pace. After Samsung was linked with a potential approach last week, the Japanese group Panasonic became the latest addition to the list of possible suitors by market gossips as the set-top box manufacturer put on 3.6p to 105.5p.

The engineers Invensys and Renishaw were also the subject of bid speculation, as they were driven up 18.4p to 277.5p and 136p to 1,410p respectively. Meanwhile, on the blue-chip index Smith & Nephew closed 29p better off at 625.5p despite MF Global playing down recent reheated chitter-chatter suggesting it could receive an approach from either Johnson & Johnson or Stryker, saying a deal would fall foul of US anti-trust authorities.

Overall, the FTSE 100 climbed 125.87 points to 5,394.53, meaning it has added over 5 per cent this week alone, although this did not prevent August being the benchmark index's worst month since May 2010.

Still, investors received a boost from the release late on Tuesday of the minutes from the latest US Federal Reserve meeting. Many were taking heart that they seemed to suggest support for a third round of quantitative easing was rising, while market voices claimed the recent run of disappointing economic data from the US – which included employment figures yesterday – appeared to be strengthening the possibility of stimulus measures being introduced.

It was no surprise, therefore, that those in the mining as well as the oil and gas sectors were well represented on the leaderboard, with Cairn Energy 18.1p higher at 334.8p while Antofagasta soared 67p to 1,349p.

Despite JP Morgan Cazenove saying it remained "cautious" on the UK domestic banks, the sector was still on the rise. Lloyds Banking Group charged forwards 1.57p to 33.6p while Barclays gained 5.35p to 170.75p and Royal Bank of Scotland was 0.63p stronger at 24.27p.

At the other end, the real-estate groups were being knocked down after analysts from Morgan Stanley cut their net asset value forecasts for 2012, focusing particularly on the UK. The ratings of both British Land and Land Securities were hit with a double downgrade from "overweight" to "underweight", with the former falling 5p to 539p while the latter eased forwards 8.5p to 736.5p.

Despite its French peer Carrefour issuing a profit warning, Tesco managed to tick up 13.8p to 378.6p as it revealed it was giving up on its Japanese business after eight years. Shore Capital applauded the decision, saying the disposal "may actually lead to a small boost to profits", while the broker added that Carrefour's disappointing update was "in stark contrast to what we expect to see from [Tesco's interim results] in October."

Down on the fledgling index, there was a severe lack of a party atmosphere around Luminar as the nightclub owner dropped over 30 per cent of its share price, dipping 1.48p to 3.15p. Reports emerged last weekend claiming the troubled company has discussed with its banks the possibility of a debt-for-equity swap.

Start your day with The Independent, sign up for daily news emails
Sport
The Queen and the letter sent to Charlie
football
Arts and Entertainment
Eurovision Song Contest 2015
EurovisionGoogle marks the 2015 show
News
Two lesbians hold hands at a gay pride parade.
peopleIrish journalist shares moving story on day of referendum
Arts and Entertainment
<p>
<b>Kathryn Williams</b>
</p>
<p>
When I was supporting Ray La Montagne I was six months pregnant. He had been touring for a year and he was exhausted and full of the cold. I was feeling motherly, so I would leave presents for him and his band: Tunnock's Tea Cakes, cold remedies and proper tea. Ray seemed painfully shy. He hardly spoke, hardly looked at you in the face. I felt like a dick speaking to him, but said "hi" every day. </p>
<p>
He was being courted by the same record company who had signed me and subsequently let me go, and I wanted him to know that there were people around who didn't want anything from him. At the Shepherds Bush Empire in London, on the last night of the tour, Ray stopped in his set to thank me for doing the support. He said I was a really good songwriter and people should buy my stuff. I was taken aback and felt emotionally overwhelmed. Later that year, just before I had my boy Louis, I was l asleep in bed with Radio 4 on when Louis moved around in my belly and woke me up. Ray was doing a session on the World Service. </p>
<p>
I really believe that Louis recognised the music from the tour, and when I gave birth to him at home I played Ray's record as something that he would recognise to come into the world with. </p>
booksKathryn Williams explores the works and influences of Sylvia Plath
News
Liz Kendall played a key role in the introduction of the smoking ban
newsLiz Kendall: profile
Life and Style
techPatent specifies 'anthropomorphic device' to control media devices
Voices
The PM proposed 'commonsense restrictions' on migrant benefits
voicesAndrew Grice: Prime Minister can talk 'one nation Conservatism' but putting it into action will be tougher
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Neil Pavier: Management Accountant

£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...

Sheridan Maine: Commercial Accountant

£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...

Laura Norton: Project Accountant

£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...

Day In a Page

Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf
From Shakespeare to Rising Damp... to Vicious

Frances de la Tour's 50-year triumph

'Rising Damp' brought De la Tour such recognition that she could be forgiven if she'd never been able to move on. But at 70, she continues to flourish - and to beguile
'That Whitsun, I was late getting away...'

Ian McMillan on the Whitsun Weddings

This weekend is Whitsun, and while the festival may no longer resonate, Larkin's best-loved poem, lives on - along with the train journey at the heart of it
Kathryn Williams explores the works and influences of Sylvia Plath in a new light

Songs from the bell jar

Kathryn Williams explores the works and influences of Sylvia Plath
How one man's day in high heels showed him that Cannes must change its 'no flats' policy

One man's day in high heels

...showed him that Cannes must change its 'flats' policy
Is a quiet crusade to reform executive pay bearing fruit?

Is a quiet crusade to reform executive pay bearing fruit?

Dominic Rossi of Fidelity says his pressure on business to control rewards is working. But why aren’t other fund managers helping?
The King David Hotel gives precious work to Palestinians - unless peace talks are on

King David Hotel: Palestinians not included

The King David is special to Jerusalem. Nick Kochan checked in and discovered it has some special arrangements, too
More people moving from Australia to New Zealand than in the other direction for first time in 24 years

End of the Aussie brain drain

More people moving from Australia to New Zealand than in the other direction for first time in 24 years
Meditation is touted as a cure for mental instability but can it actually be bad for you?

Can meditation be bad for you?

Researching a mass murder, Dr Miguel Farias discovered that, far from bringing inner peace, meditation can leave devotees in pieces
Eurovision 2015: Australians will be cheering on their first-ever entrant this Saturday

Australia's first-ever Eurovision entrant

Australia, a nation of kitsch-worshippers, has always loved the Eurovision Song Contest. Maggie Alderson says it'll fit in fine
Letterman's final Late Show: Laughter, but no tears, as David takes his bow after 33 years

Laughter, but no tears, as Letterman takes his bow after 33 years

Veteran talkshow host steps down to plaudits from four presidents
Ivor Novello Awards 2015: Hozier wins with anti-Catholic song 'Take Me To Church' as John Whittingdale leads praise for Black Sabbath

Hozier's 'blasphemous' song takes Novello award

Singer joins Ed Sheeran and Clean Bandit in celebration of the best in British and Irish music
Tequila gold rush: The spirit has gone from a cheap shot to a multi-billion pound product

Join the tequila gold rush

The spirit has gone from a cheap shot to a multi-billion pound product
12 best statement wallpapers

12 best statement wallpapers

Make an impact and transform a room with a conversation-starting pattern
Paul Scholes column: Does David De Gea really want to leave Manchester United to fight it out for the No 1 spot at Real Madrid?

Paul Scholes column

Does David De Gea really want to leave Manchester United to fight it out for the No 1 spot at Real Madrid?