London share prices displayed a mixed opening on Tuesday, with mid-cap stocks outperforming their large-cap counterparts. Financial market participants remained concerned about the possibility of a Debt Default in Washington, despite progress made during the long holiday weekend in both the UK and US.
At the start of the trading day, the Ftse 100 index experienced a slight dip of 0.1%, down 4.68 points at 7,622.52. Conversely, the FTSE 250 saw an increase of 0.3%, up 62.00 points at 18,856.09, while the AIM All-Share exhibited a marginal decline of 0.23 points, resting at 791.48.
Leaders from the Republican and Democratic parties were engaged in urgent efforts to garner Congressional support for a bill designed to avert a catastrophic US debt default. This task became even more pressing as the government approached a critical point of running out of funds, with just one week remaining.
The bill, which was finalised on Sunday by US President Joe Biden and House Speaker Kevin McCarthy following weeks of frantic negotiations, faced opposition from both the progressive and hard-right wings within their respective parties.
On one hand, ultra-conservative Republicans expressed dissatisfaction, believing that McCarthy should have negotiated more significant spending cuts in exchange for raising the Debt Ceiling and allowing the government to continue borrowing money. On the other hand, the left wing of the Democratic Party was equally displeased with Biden's acceptance of any spending limits.
In terms of individual stocks, Hiscox saw a 0.9% increase as it announced the appointment of Jonathan Bloomer, the former CEO of Prudential PLC, as chair designate.
Unilever experienced a 0.3% decline after Chief Financial Officer Graeme Pitkethly revealed his plans to step down by the end of May 2024. Consequently, the board will now initiate a formal search, both internally and externally, to find his successor.
Within the FTSE 250, RHI Magnesita saw a significant jump of 18% following an offer from Ignite Luxembourg Holdings, a company indirectly managed by Rhone Holdings VI. The offer proposed to purchase a 20% stake in RHI Magnesita at £28.5 per share in cash, representing a 39% premium compared to the stock's closing price on Friday.
Hunting experienced a notable increase of 13% after securing a $91 million contract. The company announced that its Asia Pacific operating segment had won a significant new oil country tubular goods contract with Cairn Oil & Gas, Vedanta, for their operations in Rajasthan, India.
