By Patrick Munnelly, Market Strategist, Tickmill
On Friday, London stocks experienced a slight decline before catching a late bid, however the stage was set for a weekly loss following a week characterised by risk-off sentiment in the market.
The FTSE 100 index inched higher by 0.6% by the close, and the broader context of the week had the index on track for its worst weekly loss in seven weeks.
One of the primary factors contributing to the risk-off sentiment was the surge in government bond yields, driven by expectations of higher interest rates. This development had a notable impact on equity markets, leading to increased market volatility and downward pressure on stock prices.
FTSE 100 biggest movers
Leading the blue chip index lower is Rentokil Initial LON:RTO. The business is engaged in pest control and hygiene services, and appears to have faced negative sentiment in the market following an initiation report from Societe Generale, which rated Rentokil as a “Sell”. Shares in Rentokil were down 2.6% by the close.
On the positive side of the ledger, Aviva [LON:AV,] one of the UK’s largest insurers, saw a significant increase in its stock price, with shares rising as much as 7.6% through the day and closing the session up 5.3%.
This surge made Aviva the top percentage gainer on the FTSE 100 index. The notable uptick was attributed to takeover chatter, as reported by Britain’s Times newspaper. The newspaper mentioned the possibility of a foreign buyer considering a takeover, sparking investor interest and driving up the stock price to its highest level since May 24th. It’s important to note that Aviva did not immediately respond to requests for comment regarding the takeover rumours.
For context, Aviva’s stock had experienced a decline of approximately 6% year-to-date before the surge, indicating that the takeover chatter has impacted on investor sentiment with the rumours leading to increased volatility and trading activity as investors react to the potential implications.
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