Monday, September 01 16:55:42
European shares traded near a recent one-month peak today, with merger and acquisition speculation about British broadcaster ITV helping media stocks and Novartis leading drugmakers.
Novartis, up 4.7 percent, was the top gainer on the FTSEurofirst 300 index. A new drug from the company could replace drugs that have been central to treating heart disease for a quarter of century. The Novartis advance helped the STOXX Europe 600 Healthcare index to gain the most of any sector, at 1 percent.
ITV led the European media index higher, up 0.6 percent. The Telegraph reported that Liberty Global was canvassing support from major ITV shareholders after it acquired a 6.4 percent stake, raising speculation of a full takeover bid. ITV declined to comment.
"We are likely to see M&A activities in other sectors also, as companies are looking to utilize their cash balances," said Keith Bowman, an equity analyst at Hargreaves Lansdown. "But investors will stay cautious as geopolitical concerns and uncertainty about the ECB's likely policy moves will remain in the background."
Broker Liberum said ITV was its top media pick and still had plenty of upside in its share price. Any bid for the company should reflect the potential upside from ITV's being allowed to charge re-transmission revenues for ITV1, Liberum said.
The FTSEurofirst 300 rose 0.1 percent to 1,374.74 points by 1445 GMT to trade near last week's one-month highs. The Euro STOXX 50, which will add Nokia from Sept. 22, replacing CRH after an index reshuffle, was down 0.2 percent. CRH fell 0.9 percent and Nokia dropped 1.6 percent.
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