London pre-open: Stocks seen up on Wall Street gains

(Sharecast News) - London stocks were set to rise at the open on Monday following solid gains on Wall Street at the end of last week.

The FTSE 100 was called to open 25 points higher at 7,487.

CMC Markets analyst Michael Hewson said: "Friday's record finish in the US looks set to see markets in Europe open higher this morning, despite Asia markets getting off to a mixed start as the Nikkei 225 sets fresh 34-year highs, while Chinese markets can't seem to buy a bid, after Chinese loan rates were kept unchanged.

"The current divergence between US and European markets is probably down to the belief that the US economy is in much better shape than its European counterparts, a belief that is likely to be reinforced further this week by the latest US Q4 GDP numbers, ahead of next week's Fed meeting."

In corporate news, caterer Compass Group was likely to be in focus following a report over the weekend that it's in advanced talks to take over a rival business which provides hospitality services at landmark venues including Kew Gardens and the Royal Opera House.

According to Sky News, Compass was putting the finishing touches at the weekend to a deal worth more than £400m to acquire CH&Co, a private equity-backed company.

If confirmed, it would be Compass's largest acquisition in the UK for years, although the transaction will not be material from a valuation perspective given its market capitalisation of over £37bn.

Thermal processing specialist Bodycote said it would start a $60m share buyback programme after spending less than planned on acquisitions.

The programme is expected to commence on March 18, with full details published on March 15 at the time of Bodycote's full-year 2023 results.

It also said it had completed the acquisition of US firm Lake City HT on 19 January 2024 for $66.5m (£52m) on a cash and debt free basis.

Based in Warsaw, Indiana, Lake City is a hot isostatic pressing (HIP) and vacuum heat treatment business primarily supplying the orthopaedic implant market as well as civil aerospace which would "significantly increase" Bodycote's customer reach in the medical market.

Elsewhere, Endeavour Mining said it achieved production guidance in 2023 and pointed to a further 18% output growth this year, as it promised to increase shareholder returns once its two ongoing growth projects are wrapped up.

Fourth-quarter production was flat over the preceding three months at 280 thousand ounces (koz), taking full-year output to 1,072koz, towards the lower end of the 1,060koz to 1,135koz target. This was the 11th straight year of achieving or beating production guidance, the company said. Looking ahead, production is estimated to rise to 1,130koz to 1,270koz in 2024, helped by project start-ups in the second quarter of the year.