LONDON MARKETS: London Markets Start The Week Calmer After Selloff

By Dave Morris

The selloff in London markets slowed to a crawl Monday, in an attempt to shake off the jitters from Friday's brisk plunge.

How did markets perform?

The U.K.'s FTSE 100 slipped 0.3% to 7,184, a relief to investors after Friday's 2% fall. The pound was down 0.3% Monday to $1.3179, following Friday's 1.1% rise.

What's driving the markets?

Friday's market declines were dramatic as growth worries in Europe and elsewhere slapped equities down hard. The German Ifo business climate survey on Monday surprised to the upside (http://www.marketwatch.com/story/survey-shows-german-business-mood-brightening-2019-03-25) at 99.6 for March, higher than analysts' expectations of 98.3 and the previous figure of 98.5. This was welcome news to investors spooked by Friday's Purchasing Managers Index (PMI) data indicating that the German economy was slowing.

The U.K. papers and Sunday chat shows were abuzz with speculation about whether Prime Minister Theresa May would be ousted over her handling of Brexit, even though technically the Conservative Party is unable to hold another confidence vote in her leadership until December after the failed coup attempt in 2018. At any rate, by Monday the papers were reporting that talk among senior Tory party leaders had cooled, leaving May to get back to whatever it is that she has been doing.

Brexit Breif:May faces pressure to resign as deal hopes fade (http://www.marketwatch.com/story/brexit-brief-may-faces-pressure-to-resign-as-deal-hopes-fade-2019-03-25)

"The weekend speculation about the PM's position adds another layer of complication to the Brexit process," wrote Peel Hunt economics and strategy analyst Ian Williams, who cautioned that "the immediate preoccupation of equity investors in the U.K. should have shifted after markets suffered a serious bout of the growth jitters at the end of last week."

Which stocks are active?

U.K. satellite equipment maker Inmarsat Plc (ISAT.LN) jumped 6.4% on news that it had agreed to be taken over (http://www.marketwatch.com/story/inmarsat-agrees-34b-takeover-from-investor-group-2019-03-25) by a consortium led by private equity firm Apax Partners LLP for $7.21 in cash per share.

ConvaTec Plc (CTEC.LN) , a U.K. medical technology company, rose 4.6% on news that it had poached Karim Bitar from another firm to be its new chief executive.

Russ Mould, investment director for AJ Bell, applauded the move. "ConvaTec desperately needs a new lease of life as it has been a serial disappointment for most of its time as a listed business. Having made an impressive start by qualifying for the FTSE 100 index mere weeks after its IPO in 2016, its shares have been in a falling trend since summer 2017," said Mould.

U.K. energy services company John Wood Group Plc (WG.LN) fell nearly 5.2% as analysts at Jeffries cut their price target for the stock to 480p. In an earnings report March 19, he company said its debt reduction program would take longer than previously expected.

(END) Dow Jones Newswires

March 25, 2019 07:39 ET (11:39 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.