Strong corporates earnings and a buzz around potential M&A helped the FTSE 100 to a fresh all-time intraday high on Tuesday with Coca Cola HBC and Vodafone leading the gains.
The FTSE 100 hit 7,996 on Tuesday – an all-time record high for the FTSE 100.
However, the index eased off as the session progressed and we received the latest instalment of US CPI data.
The highly anticipated January US CPI came in slightly above expectations at 6.4%, versus economist expectations of 6.2%. The release will strengthen the argument for slower interest rate hikes as inflation rates are clearly falling, but the timing and pace of future hikes will be a source of uncertainty due to the inflation rate being higher than expected.
Markets will receive an insight into Federal Reserve thinking with a number of speakers lined up for the coming days.
A fractionally hotter inflation rate induced choppy trade global equities with US equity futures swinging from gains to losses. The FTSE 100 was trading at 7,968 at the time of writing.
In a week billed to be dominated by inflation data, it was individual names driving the FTSE 100 higher on Tuesday. Vodafone shot up 4% after Liberty Global took a 5% stake in the beleaguered telecoms group and Coca Cola HBC cheered strong results.
Vodafone
The acquisition of a 5% stake ignited speculation of a full takeover approach from Liberty Global, or indeed another telecoms group.
“Consolidation is the name of the game in the telecoms sector and Liberty Global is taking a £1.2 billion bet that Vodafone is going to be an important cog in the system,” said AJ Bell investment director Russ Mould.
“By acquiring nearly a 5% stake Liberty Global is essentially getting its foot in the door should any new deals start to emerge. The company says the stake is only for investment purposes, but it’s got form in seeking optionality for potential deals.
“Liberty Global has been quietly sitting on a 9.9% stake in ITV for some time, while it also has positions in various telecoms and media groups including Virgin Media O2 and All3Media.”
Vodafone shares have suffered dearly over the past five years and some investors may be hoping they are put out of their misery by a takeover.
Coca Cola HBC
Far from the most glamorous FTSE 100 constituent, Coca Cola HBC was the top riser on Tuesday after the bottling company revealed another strong period of growth.
In the 2022 full year, organic revenue excluding Russia and Ukraine was up 22.7% and comparable EBIT jumped 11.9% to €929.7m.
Coca Cola HBC shares were 6.6% higher to 2,067p at the time of writing.