All a tad quiet this morning. European stock markets were tentatively higher in early trade Friday after another record session on Wall Street saw the three major indices rally, though small caps declined. The FTSE 100 led the way as it sprang back from yesterday’s ex-divis, up 0.3% to 7,220, whilst the DAX moved close to 16,000. Asian stock markets moved in the opposite direction as concerns about the pace of the delta variant in the region left many of the major indices lower again. There is not a whole lot going on today and risk remains fairly muted as US 10yr yields hover around 1.34% and FX markets look reasonably calm. Gold made further gains to $1,760 in the wake of yesterday’s strong producer price inflation print in the US.
Up in smoke: Vectura’s board recommended the Philip Morris offer of 165p, a 10p-per-share premium to the Carlyle bid, but in the statement they seemed to make a point of stressing they did so on advice from their bankers and they were heavy on the idea of ‘fiduciary duties’. They argue that “wider stakeholders could benefit from PMI's significant financial resources and its intentions to increase research and development investment and to operate Vectura as an autonomous business unit that will form the backbone of its inhaled therapeutics business”, but clearly there will be much hand wringing over the fact this business has been taken over by Big Tobacco and many investors will worry about the ESG implications of the transaction. But probably not enough to vote down the deal. The government could yet step in.
Shares in Airbnb fell in after-hours trading despite a 300% pop in revenues. Despite the strong figures for the second quarter, the company warned about the impact of the delta variant. Meanwhile Disney reported a blowout quarter, with parks returning to profitability for the first time since the pandemic struck. Earnings came in at $0.80 per share vs the $0.55 expected as subscriber figures for Disney+ also beat forecasts at 116m.