LONDON MARKETS: FTSE 100 Inches Higher, But Stops Short Of Record Close

By Carla Mozee, MarketWatch Features Dow Jones Newswires

GKN reportedly considering splitting up in two

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U.K. stocks ended a choppy session marginally higher on Monday, with traders opting to err on the side of caution ahead of a busy week of economic data and earnings.

The FTSE 100 index rose 0.02% to close at 7,524.45, leaving it within touching distance of its record close of 7,556.24 hit earlier in October.

"Ahead of a big week for earnings and monetary policy, it has not been surprising to see the remarkable stock market rally of the past two months pause for breath," said Chris Beauchamp, chief market analyst at IG, in a note.

On Wednesday U.K. growth data for the third quarter come out, while all eyes will be on the European Central Bank on Thursday where the policy makers are expected to lay out a timetable for tapering monthly asset purchases.

Meanwhile, Bank of England Deputy Gov. Jon Cunliffe once again against struck a cautious tone about a possible rate increase in November. Rates may have to increase but it's an "open question" on the timing of such as move, Cunliffe told the Western Mail newspaper in Wales in an interview published Monday (http://www.walesonline.co.uk/business/business-news/interest-rates-go-up-not-13799399).

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The pound traded at $1.3198, up from $1.3188 late Friday in New York.

Corporates: GKN PLC (GKN.LN) gained 5.1% following a Sunday Times report the company is considering a split of its aerospace and automotive businesses (https://www.thetimes.co.uk/article/gkn-which-makes-wing-tips-for-airbus-and-parts-for-mercedes-eyes-split-to-create-two-ftse-champions-x7c2t6bj0).

Spire Healthcare Group PLC shares (SPI.LN) rallied 15% on the midcap FTSE 250 after Spire rejected a preliminary takeover approach from major shareholder Mediclinic International PLC (http://www.marketwatch.com/story/spire-rejects-mediclinics-16-bln-takeoveroffer-2017-10-23)(MDC.LN). The offered valued Spire at about GBP1.20 billion ($1.59 billion). Mediclinic shares fell 2.7% on the FTSE 100.

Also off the FTSE 100, Pendragon PLC shares (PDG.LN) plunged 18% after the auto dealer issued a profit warning, citing a decline in demand for new cars and a price correction for used cars. Pendragon also said Chairman Mel Egglenton has stepped down with immediate effect for personal reasons.

"It's the latest sign of retail-woe in the U.K., especially among companies dealing with big ticket items, as the household spending squeeze continues," said Spreadex financial analyst Connor Campbell in a note.

CRH PLC shares picked up 1% after the building materials supplier won support of its planned takeover of Ash Grove Cement Co. (ASHG).

(END) Dow Jones Newswires

October 23, 2017 12:14 ET (16:14 GMT)