FTSE 100 edges lower, DS Smith soars on acquisition talks

Energy, banking shares pull index down, offset by packaging firm's potential buyout.

FTSE 100 edges lower, DS Smith soars on acquisition talks
FTSE This Morning

The FTSE 100 opened marginally lower on Wednesday, weighed down by declining energy and banking stocks. However, losses were limited by a substantial jump in DS Smith shares after the packaging company confirmed discussions with International Paper for a potential acquisition deal.

The blue-chip FTSE 100 index slipped 0.2%, while the FTSE 250, comprising more domestically-focused companies, dipped 0.1%. The energy sector dropped 0.9% as crude oil prices fell for the second consecutive day following a report indicating an increase in U.S. crude stockpiles. Bank stocks also lagged, declining 0.8%.

DS Smith emerged as the standout performer, surging 7.7% after confirming talks with its U.S.-listed rival, International Paper, regarding a potential £5.72 billion ($7.22 billion) all-stock buyout.

Elsewhere, Diploma, a specialised products and service distributor, soared 10.8% after announcing the £236 million ($297.88 million) acquisition of Peerless Aerospace Fastener.

In contrast, Strix Group shares fell over 6%, despite the kettle safety controls firm reporting a 35% jump in annual revenue to £144.6 million, largely driven by the acquisition of Billi Australia in 2022.

Old Mutual shares jumped over 5% in early trading after the banking group reported a "robust" financial performance for 2023, with pre-tax profit more than doubling to R13.97 billion from R6.56 billion a year earlier, attributing the growth to "exceptional" gains in the value of the new business.

Market participants remain focused on the upcoming release of the U.S. personal consumption expenditure price index (PCE), the Federal Reserve's preferred inflation gauge, scheduled for Friday when most global markets will be closed for the Good Friday holiday.

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