Reckitt Benckiser (LON:RB) is among this Thursday’s UK share prices to watch, trading higher as investors welcomed the company’s hefty settlement with US authorities over its former unit Indivior. Broader market sentiment meanwhile is upbeat following dovish comments by Federal Reserve Chairman Jerome Powell.
Reckitt Benckiser gains ground
Reckitt Benckiser is outperforming the market after announcing that it had agreed a $1.4-billion settlement with the US over Indivior, which was demerged from the FTSE 100 group in 2014. The ormer RB unit was accused earlier this year of engaging in an illicit nationwide scheme to increase prescriptions of Suboxone Film, an opioid drug used in the treatment of opioid addiction. Reckitt Benckiser said today that it would increase its provision from $400 million to $1.5 billion at its half-year results.
“The settlement at up to $1.5 billion, while larger than the existing $400 million provision, is a necessary price to pay to close off this investigation and enable RB to move forward with the completion of its RB 2.0 program and transformation under new CEO Laxman Narasimhan,” Liberum said, as quoted by Proactive Investors. Reuters meanwhile quoted Deutsche Bank analysts as commenting that with this settlement, the FTSE 100 drew “a line under an issue that would, at best, have resulted in additional cost/distraction/uncertainty and could, at worst, have led to much more costly and protracted legal proceedings”. Reckitt Benckiser’s shares have added about 2.4 percent in early afternoon trade.
Barratt Developments (LON:BDEV) has remained among this week’s UK share prices to watch as Morgan Stanley lifted its price target on the blue-chip housebuilder from 625.0p to 675.0p in the wake of the company’s trading update yesterday. Sharecast quoted the broker as commenting that based on balance-sheet metrics the FTSE 100 group was the cheapest homebuilder in their coverage universe, changing hands on 1.4 tangible book value with “better earnings momentum,and more room than peers to improve margins and returns, in our view”.
Barratt’s shares are up by about 3.7 percent. FTSE 100 peers Persimmon (LON:PSN) and Taylor Wimpey (LON:TW) outperforming the market with a 0.3-percent and 1.14-percent gain, respectively, benefitting from the latest housing market data from the Royal Institution of Chartered Surveyors (RICS).
“Investors raced to snap up shares in housebuilders after the latest RICS survey showed some signs of recovery in the housing market,” reported Russ Mould at AJ Bell, as quoted by Proactive Investors, adding that while it was “too early to call a bounce-back in the property market based on one set of data, the news does offer a glimmer of hope for investors in housebuilding stocks”.
Shares in Land Securities (LON:LAND) meanwhile have remained steady as the company announced that its chief executive Robert Noel had informed the board that he was planning to be stepping down next year. The FTSE 100 group said that it will start a formal search process to find a successor. Land Securities’ shares are up by 0.1 percent.
Elsewhere in the London market, oil majors Royal Dutch Shell (LON:RDSA) and BP (LON:BP) have found support in higher crude prices on the back of tensions in the Persian Gulf.
“There’s been further gains seen in the price of crude oil with international benchmark Brent hitting its highest level since the end of May, above $67 a barrel, as tensions in the Gulf are escalating once more,” reported David Cheetham at xtb online trading, as quoted by Proactive Investors. “Reports that Iranian boats attempted to impede a British oil tanker before being driven off by a Royal Navy ship has once more raised the spectre of a major disruption in what is a key choke point for waterborne crude.” Both Shell and BP are up by about 0.5 percent each.
UK share prices to watch tomorrow
Specialist Emerging Markets investment manager Ashmore Group (LON:ASHM) will be among tomorrow’s UK share prices to watch, with the company set to post its fourth-quarter assets under management statement ahead of its full-year results on September 6. In April, the company reported that its assets under management had increased by $8.6 billion in the quarter ended March 31, benefitting from net inflows of $5 billion and positive investment performance of $3.6 billion. The company further noted that client activity levels had picked up through the reported quarter following a slight pause at the end of 2018.
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