On Thursday, the FTSE 100 attacked the 8,600 level as positive reactions to corporate earnings in both the UK and US lifted the mood.

Airtel Africa and St James’s Place were the FTSE 100’s standout performers, with gains of 9% and 8%, respectively.

US stocks had a minor wobble overnight after the Federal Reserve kept rates on hold in a ‘hawkish hold’, which signalled to the market that they shouldn’t expect too much from the Fed this year in terms of rate cuts.

“The Fed, as expected, kept interest rates in a holding pattern, but dropped its recent mention of inflation making progress,” said Susannah Streeter, head of money and markets, Hargreaves Lansdown.

“With threats and speculation flying around about trade tariffs and the potential impact on consumer prices, its little wonder policymakers seem in no rush to cut rates again, especially given the resilience of the US economy.”

The S&P 500 sank after the decision was released yesterday evening, but most of the lost ground was quickly recovered as a raft of earnings from US tech giants had a net positive on US indices. Meta rose on strong results but Microsoft shares fell as cloud revenue growth slowed. Tesla investors choose to look past a soft quarter to the promise of earnings growth over the coming year.

Although there was still evidence of concern around the emergence of DeepSeek as Nvidia shares slipped back again in US trade yesterday, the pessimism looks to be largely focused on chipmakers, with most of the ‘Magnificent Seven’ unscathed.

The turnaround in the final hours of US trade translated into an upbeat start in Europe, with the FTSE 100 up by 0.3% at the time of writing.

Shell shares rose following the release of fourth-quarter results. Shell released an earnings teaser earlier this month that dampened the impact of final quarterly results, so the sharp drop in adjusting earnings and EBITDA were largely priced in. 

“Shell’s fourth-quarter underlying profit slumped 39% on a sequential basis to $3.6bn, bringing the full-year total to $23.7bn, 16% lower than 2023,” said Derren Nathan, head of equity research, Hargreaves Lansdown.

“The slowdown at the end of 2024 reflected lower margins in its trading businesses as well as the marketing division which includes its network of petrol forecourts. Lower oil prices also played their part. Exploration well write-offs were another headwind reflecting the increasing difficulty of discovering new sources of hydrocarbons.

“But one thing that has kept flowing is cash. Shell generated $8.7bn of free cash flow in the final quarter and nearly $40bn over the year as a whole.”

Oil is finding its feet after several days of declines, which is providing additional support for Shell. BP rose in sympathy.

BT Group was the top faller after the company issued yet another disappointing trading update that revealed little to no growth across all business units.

“BT fell 4.1% after a patchy third quarter. It’s all well and good talking about cost transformation when sales are falling nearly across the board. Openreach was the only business area to show revenue progression,” explained Russ Mould, investment director at AJ Bell.

Premium mixer brand Fever-Tree has announced a strategic partnership with beverage giant Molson Coors, marking a significant development in its US expansion strategy.

The partnership grants Molson Coors exclusive rights for sales, distribution, and production of Fever-Tree products across the United States.

Fever-Tree has established itself as America’s leading tonic and ginger beer brand since entering the market in 2008. Under the new agreement, Fever-Tree will leverage Molson Coors’ extensive national distribution network and commercial infrastructure to accelerate its growth in both the on-trade and off-trade sectors.

As part of the agreement, Molson Coors will acquire an 8.5 per cent stake in Fever-Tree for £71.0 million, representing a price of 654.2 pence per share.

Fever-Tree plans to return these proceeds to shareholders through a share buyback programme, scheduled to commence in February 2025. Fever-Tree investors were in desperate need of some good news after years of spluttering sales growth and declines for the shares. Today’s announcement offers a glimmer of hope.

The partnership includes substantial marketing investment and plans to establish local US production facilities, utilising Molson Coors’ supply chain expertise. This move is expected to generate significant operational efficiencies for Fever-Tree’s American operations.

“Today’s announcement marks a transformational step for the Fever-Tree brand in the US.  Thanks to the superb work of our US team, we have seen Fever-Tree become the number one brand in both the tonic and ginger beer categories, a remarkable achievement which has redefined the US mixer category amongst consumers and customers alike,” said Tim Warrillow, co-founder and CEO of Fever-Tree.

“But what is so exciting is that as the Fever-Tree brand has grown in the US, so has the opportunity ahead of us, reflecting the increasing number of categories and occasions that our products are relevant to.”

Automotive components supplier Dowlais Group (LON: DWL) is the best performer in the FTSE 250 index following its agreed merger with American Axle & Manufacturing. The cash and shares bid values Dowlais at £1.16bn. The share price is 10.3% higher at 75.375p.

Dowlais is effectively the former GKN automotive businesses and was spun out of aerospace company Melrose Industries (LON: MRO), the former AIM company now in the FTSE 100 index, in April 2023. The share price is trading at just over 50% of its peak in May 2023.

For each Dowlais share investors will receive 42p/share in cash and 0.0863 of an American Axle & Manufacturing. They will also receive a 2024 final dividend of up to 2.8p/share. That values each Dowlais share at 85.2p each at an American Axle & Manufacturing share price of $5.82.

The combination will create a leading drivetrain and metal forming business. It will have a wider range of customers. There could be annual cost savings of $300m by the end of the third year after the combination. The exceptional charges to achieve this could be equivalent to one year of the full savings.

Purchasing should yield 50% of the savings due to economies of scale and the internal supply of products. Cutting out listing costs and eliminating duplications should save 30% of the savings and the rest will come from improved efficiency.