FTSE 100 Live Wednesday

• Rio Tinto in £5.1bn lithium deal

• Mondi shares jump on Germany expansion

• Food demand boosts Marston's sales

Market update: Rio Tinto and Mondi strike deals, M&S shares upgraded

10:30 , Graeme Evans

Dealmaking by Rio Tinto and Mondi accompanied a steadier performance by the FTSE 100 index as London trading contrasted with more volatility in China.

Disappointment over the scale of stimulus efforts meant the Shanghai Composite slid 6.6% to unwind gains seen before the Golden Week holiday.

Having closed 1.4% lower yesterday, the FTSE 100 index recovered by 30.60 points to 8221.21 amid support from a tech-led rebound on Wall Street.

A light session for corporate updates was offset by Mondi acquiring the Western Europe assets of Schumacher Packaging and Rio Tinto agreeing to buy Arcadium Lithium for £5.1 billion.

Mondi, which recently failed with an attempt to buy fellow blue chip DS Smith, rose 4% or 51p to 1454.5p as the best stock in the FTSE 100 index.

The purchase with an enterprise value of £531 million includes two state-of-the-art mega-box plants in Germany and a site in Birmingham.

The proposal by Rio Tinto is pitched at a 90% premium and comes with spot lithium prices down by more than 80% on their peak level.

Chief executive Jakob Stausholm called the counter-cyclical acquisition a “significant step forward” for Rio as a global leader in energy transition commodities - from aluminium and copper to high-grade iron ore and lithium.

Rio shares fell 27p to 5017p, a decline of just under 1% that placed the miner alongside Rolls-Royce, NatWest and GSK on the FTSE 100 fallers board.

Vistry was the subject of more selling as brokers reviewed price targets after yesterday’s profit warning, which was caused by the housebuilder’s overly optimistic cost assumptions in one of its regional divisions.

UBS is now at 880p, which compares with this morning’s level of 959.5p after shares fell another 4p on top of last night’s 24% slump.

Other stocks in focus included Marks & Spencer, which lifted 7.2p to 379.1p after Deutsche Bank upped its target to 430p ahead of next month’s interim results and capital markets day.

And business information group Informa improved 10.2p to 811.6p, having completed the acquisition of Cannes Lions host Ascential.

The FTSE 250 index cheered by 0.6% or 124.76 points to 20,755.96, led by a strong session for trading platform CMC Markets.

Cost controls and a strong revenue performance means it expects half-year profit of £51 million compared with a £2 million loss the year before. Shares rose 4% or 14.5p to 319.5p.

Among the small caps, Marston’s added 0.1p to 43p after the 1,339-strong pub chain reported that like-for-like sales rose 3.8% in the 13 weeks to 28 September.

AIM-listed Netcall, which provides automation and customer engagement software, rose 2.5p to 88p. Annual results revealed a higher proportion of recurring revenues from cloud subscriptions, while adjusted earnings improved 5% to £8.4 million.

Mondi acquisition sends shares to top of FTSE 100

09:02 , Graeme Evans

Paper and packaging firm Mondi is the top stock in the FTSE 100 index after it announced a deal to acquire the Western Europe assets of Schumacher Packaging.

The agreement includes two state-of-the-art mega-box plants in Germany, located at Ebersdorf and Greven, and a corrugated converting facility in Birmingham.

In total, Mondi is acquiring seven corrugated converting plants, two solid board mills, and four solid board converting plants representing around 2,200 employees.

The acquisition, which values the operations at 634 million euros (£531 million), helped Mondi shares to rise by 4% or 52.5p to 1456p.

FTSE 100 steadies, CMC Markets up 6% at top of FTSE 250

08:36 , Graeme Evans

The FTSE 100 index is on the front foot after yesterday’s poor session, with the top flight up 0.4% or 33.99 points to 8224.60.

Stronger stocks include Marks & Spencer, which rose 3p to 374.9p after Deutsche Bank upped its price target to 430p ahead of November’s interim results and capital markets day.

United Utilities rose 13.5p to 1019.5p and business information group Informa is up 13.6p to 815p, having completed the purchase of Cannes Lions host Ascential.

Vistry shares remain under pressure in the wake of yesterday’s profit warning as shares fell another 7p to 956.5p after closing 24% lower last night.

Rio Tinto declined 13.2p to 5030.8p after announcing its counter-cyclical takeover of Arcadium Lithium at a 90% premium price of £5.1 billion.

The FTSE 250 index rose 0.3% or 60.85 points to 20,692.05, with CMC Markets up 6% or 17.5p to 322.5p after the trading platform highlighted a sharp recovery in half-year profitability in its latest update.

Among smaller stocks, pub chain Marston’s lifted 0.4p to 43.2p as investors welcomed like-for-like sales growth of 3.8% in the 13 weeks to 28 September.

Rio Tinto “buys the dip” in deal for Arcadium Lithium

08:09

Rio Tinto’s acquisition of Arcadium Lithium is due to complete in mid-2025 and values the New York-listed firm’s shares at a 90% premium to Friday’s level.

Hargreaves Lansdown analyst Matt Britzman said: “This is a classic attempt to buy the dip for Rio, snapping up some high-quality lithium assets when spot prices are around 80% down on their highs.

“It’s a good time to shop for counter-cyclical assets, and this deal helps propel Rio’s lithium portfolio to new heights, with it already having exposure through its Rincon and Jadar projects.

“This so-called white gold, a key component in the energy transition with uses in areas like electric vehicles, is the material that differentiates Rio from key rivals like BHP.”

Read more here

Marston's cheer amid strong food demand

07:39 , Graeme Evans

Wet weather has failed to dampen spirits at pub chain Marston’s after like-for-like sales rose 3.8% in the 13 weeks to 28 September.

In a boost ahead of the festive season, Marston’s said food sales performed “exceptionally well”.

Total revenues across the financial year rose 5.8%, with the like-for-like figure of 4.8% “outperforming the broader market”.

The company, which operates 1,339 pubs having sold its remaining brewing stake, expects profits for the year in line with the City’s estimate of £40.5 million.

Chief executive Justin Platt said: “'The strong revenue performance is very pleasing.”

Read more here

Rio Tinto strikes £5bn lithium deal

07:22 , Graeme Evans

Mining giant Rio Tinto is to buy US-based Arcadium Lithium in a deal worth $6.7 billion (£5.1 billion).

Chief executive Jakob Stausholm called the move a “significant step forward” for Rio as a global leader in energy transition commodities - from aluminium and copper to high-grade iron ore and lithium.

Rio has made the counter-cyclical acquisition at a time when spot lithium prices are down more than 80% versus peak levels. It makes the FTSE 100 company one of the leading lithium producers globally

Philadelphia-based Arcadium was created in January following a merger of equals between Livent and Allkem. It employs 2,400 people and has projects in Argentina, Australia, Canada and China.

Its butyllithium facility on Merseyside services the polymer and pharmaceutical markets and has been operating for over 40 years.

FTSE 100 seen higher after Wall Street rally, Asia markets mixed

07:04 , Graeme Evans

A robust session on Wall Street means the FTSE 100 index is set to recover some of yesterday’s 1.4% decline.

Futures trading points to an improvement of 24 points to 8215, boosted by gains of 1% for the S&P 500 index and 0.3% for the Dow Jones Industrial Average.

Brent Crude is 0.8% higher at $77.80 a barrel after a sharp fall yesterday due to concerns about China demand. The pound remains at $1.309.

In Asia, the Shanghai Composite is 4% lower in a continuation of the volatility since traders returned from the Golden Week holiday.

Hong Kong’s Hang Seng index is 0.4% higher and the Nikkei 225 up 1%.