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Standard Life leads FTSE higher

Thursday, September 04 09:28:08

Britain's top share index edged higher on Thursday to trade near a 14-year high, with Standard Life leading insurers higher and adding the most points to the index after agreeing to sell its Canadian operations.

The UK life insurance index climbed 1.2 percent, the top sectoral gainer, boosted by a 9.5 percent surge in shares of Standard Life following its deal worth about C$4 billion ($3.7 billion) in cash with Manulife Financial Corp.

The companies said they will also expand an existing wealth and asset management partnership, with Manulife distributing Standard Life funds in Canada, the United States and Asia, and Standard Life doing the same in the UK retail market.

"The disposal accelerates Standard Life's strategy of asset gathering and asset management and removes a major exposure of the group's balance sheet to spread and guarantee risk," Eamonn Flanagan, analyst at Shore Capital, said.

"The agreement for Manulife to act as distributor for SL's funds should deliver growth in funds, thus accelerating Standard Life's focus as an asset gatherer and manager."

Insurers helped the blue-chip FTSE 100 index to gain 0.1 percent to 6,882.30 points by 0754 GMT. The index climbed to its highest level in more than 14 years in the previous session as signs that Ukraine and Russia were working to end the conflict in eastern Ukraine lifted sentiment.

However, investors stayed cautious ahead of the European Central Bank's policy meeting later in the day. The ECB faces intense market pressure to take policy action and risks losing credibility if it fails to back up a dovish message delivered by President Mario Draghi late last month.

Draghi ramped up expectations when, departing from his speech text, he told the Jackson Hole central bankers' conference on Aug. 22 that markets had indicated inflation expectations showed "significant declines" in August. (Reuters)

For more visit: www.businessworld.ie