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Fri City brief: Majestic bags Naked: FTSE hits new high

The FTSE100 surged to a new all-time high on Friday, topping a previous peak reached two weeks ago, despite concerns about a slowdown in UK economic growth.

The Footsie finished 74.41 points higher, rising 1.06% to a fresh record of 7,089.77, helped by gains from Shire, Aberdeen, ITV and a number of housing stocks.

The index surpassed its previous intraday record high of 7,065.08 reached on 24 March and previous record close of 7,036.67.

Housebuilders were among the best performers as Jefferies upgraded ratings for stocks across the sector, including Barratt Developments, Taylor Wimpey, Persimmon, Bellway, Crest Nicholson and Redrow. Jefferies said it has turned more positive on the sector after recent data “point[ed] to a stronger pre-election housing market than we had anticipated”.

Shares rose in Aberdeen Asset Management as traders linked a more bullish outlook for emerging markets being a driver behind the rally for asset managers who have significant exposure in Asian, African and Latin American assets.

ITV jumped after Morgan Stanley boosted the stock with its bullish view in a note to clients. “It is a key pick in the media sector,” said the bank.

Majestic Wine announced it was buying Naked Wines, a customer funded international online wine business, for up to £70m in a reverse takeover.

Majestic will pay £50m  on completion in cash, plus up to £20m in shares. Cash consideration is being funded by new debt facilities. Majestic said that the deal is expected to be enhancing to fully earnings in 2017.

Rowan Gormley, founder and CEO of Naked Wines, takes up the same role in the combined group.

Majestic said the final dividend for FY 2015 and the interim dividend for FY 2016 will be withheld, with future dividends to be progressively re-instated by FY 2018.

 

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