Market Report: Anglo American chief open to an offer

It’s not often the boss of a takeover target that sparks the deal chatter, but yesterday Anglo American chief Mark Cutifani sent City pulses racing after signalling he was open to an offer.

The mining giant jumped 38.5p to 1,562p after Mr Cutifani said in an interview with The Wall Street Journal: “If somebody sees value, then there’s a conversation to be had.”

Traders took that to mean Anglo American is open to either selling off assets or a straight takeover. The wider mining sector was also boosted by news that Australia’s government is moving to scrap a 30 per cent tax on profits in the industry. Diggers added 5.81 points to the blue-chip index.

Vodafone was buoyed 2.2p to 208.9p as a familiar takeover rumour circulated. Japan’s SoftBank is said to be interested in snapping up the telecoms group. It is set for a windfall from the blockbuster float of Chinese e-commerce giant Alibaba, in which it holds a 34 per cent stake.

Tesco added 5.35p to 230.9p as City speculators named the supermarket as another potential target, due to recent share price weakness. And Sainsbury’s put on 5.2p to 294.7p, with some in the market talking up the now hackneyed tale that the Qataris could be close to a bid.

Amid the excitement, the FTSE 100 inched 3.86 points higher to 6829.17. Losers included engineer IMI, down 25p at 1329p after a downgrade from Credit Suisse, and Royal Bank of Scotland, 8.8p lower at 351.5p.

On the face of it, news that RAC has pulled out of a £30m venture with insurance outsourcer Quindell doesn’t seem like a positive. But punters managed to look on the bright side, buying into Quindell’s view that RAC’s exit will help it trim spending. Quindell added 10p to 179p.

Oil in the East Midlands helped Egdon Resources 1p higher to 24p, Europa Oil & Gas up 0.75p to 8.12p and Union Jack Oil climb 0.03p to 0.34p. Hydrocarbons have been discovered at the Wressle-1 Well near Scunthorpe, which all three explorers have a stake in.

Greka Drilling added 1.35p to 11p after telling investors progress on its $65m contract with Essar Oil to drill 100 wells in West Bengal was on track.