Standard Chartered shares were weaker on Friday after First Abu Dhabi Bank squashed the prospect of a takeover.

A statement released by First Abu Dhabi Bank read: “First Abu Dhabi Bank PJSC notes the recent press speculation in relation to Standard Chartered and re-iterates that it is not evaluating a possible offer for Standard Chartered.”

Standard Chartered shares were down by 4.5% to 732p at the time of writing.

“Given that Standard Chartered has such a large footprint in emerging markets with its operations in 59 countries, and is highly active across the Middle East, it’s clear why speculation about a First Abu Dhabi Bank takeover reached fever pitch given the opportunities presented,” said Susannah Streeter, head of money and markets, Hargreaves Lansdown.

Streeter continued to explain the issues with Standard Chartered – and why First Abu Dhabi Bank may be holding off.

“However, there are still risks ahead, given that the group has large exposure to commercial real estate debt in China, with related impairment charges chipping away at profit’s full potential. Although this may be part of the reason why FAD is for now steering clear, it’s also likely to be down to takeover rules. After FAB first announced in January it was stepping away from any offer, a six-month cooling off period kicked in, which means it is not meant to do any more deal work”

London markets are now on FTSE 100 8,000 watch after 2022 results from FTSE 100 stalwarts British American Tobacco, Unilever and AstraZeneca helped propel the index to fresh all-time highs and towards the 8,000 milestone.

The FTSE 100 was trading at 7,941 at the time of writing having hit 7,947 earlier in the session – a new all-time intraday high.

In reality, it was AstraZeneca driving most of the gains on Thursday with the pharma giant gaining 4.2% to 11,220p. AstraZeneca is the second largest company listed on London’s markets with a market cap of £166bn.

Unilever shares were largely flat while British American Tobacco shares slipped 4.6%.

Unilever’s revenue grew 9% in 2022 as the consumer group hiked prices to fight off price inflation. A worrying outlook for British American Tobacco’s core markets hit investor sentiment.

Gains in HSBC and Shell helped lift the FTSE 100 as both companies rose around 1%-1.5%.

Standard Chartered

Standard Chartered was the FTSE 100’s top gainer on reports of interest in the bank from First Abu Dhabi Bank.

“Reports suggest First Abu Dhabi Bank is still interested in buying Standard Chartered, despite guidance to the contrary last month,” said Russ Mould, investment director at AJ Bell.

“If successful, it would represent yet another UK stock acquired by a foreign player. It would also play to the theory that industry players are more likely to buy UK-listed companies than private equity in the current environment.”

Standard Chartered was 9% higher at the time of writing.

Entain

It was potential M&A activity also driving Entain shares on Thursday. But in the case of gaming company Entain, it was a move to the downside as chances of a takeover were dashed in an analyst call.

“Entain has fallen sharply after rumours about a possible takeover were quashed. Speculation that MGM might be ready to make a move were shut down by the company during an analyst call,” said Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown.

“BetMGM, Entain’s joint venture with US-based MGM, has been a shining light for the group that’s expected to start turning a profit over the second half of 2023 and that’s partly why the rumour mills have been whirring.”

It is difficult to find a better representation of the pressures on global consumers than the 2022 results from consumables behemoth Unilever.

Input cost inflation saw Unilever’s operating margins decline 230bps, but by passing on some of the higher prices to customers, the group carved out 9% sales growth and a 0.5% increase in operating profit to €9.7bn.

However, for a company that operates in a sector that is considered to have a low price elasticity of demand, it was evident higher prices have drove some customers elsewhere with underlying volumes falling 2.1%.

“Has Unilever put its prices up too much? That’s the question after it once again reported a rise in revenues and a decline in sales volumes,” said Russ Mould, investment director at AJ Bell.

“While consumers have got used to everything costing a bit more in the shops, there is still a point where certain items become unaffordable, or where the price-point for a cheaper alternative is too good to ignore.”

“Even though Unilever boasts some of the world’s most-loved brands, sometimes consumers have no other choice but to plump for generic versions due to their financial circumstances. And if you listen to what supermarkets have been saying recently, own-label products are flying off the shelves.”

Underlying volumes in their Home Care and Personal Care divisions were hit the hardest, falling 3.5% and 3.7% respectively.

The Home Care division’s revenue rose the most of all, gaining 11.8%, as Unilever hiked prices by 15% to stave off surging input costs for products such as floor cleaner.

The company said they expected cost inflation to persist in 2023 and cautioned investors to expect only a modest increase in margins in the year ahead.

Unilever shares were broadly flat in Thursday, up just 0.4% at the time of writing.

AstraZeneca shares were 4.5% higher on Thursday after the pharma giant released a very respectable set of results for 2022. Revenue increased by 25% on a constant current basis and core EPS rose 33%.

The surge in revenue was a result of improved performance across all major therapy areas, and the inclusion of new drugs such as Alexion.

Although the entirety of 2022 saw robust sales growth, there was weakness in the fourth quarter due to declines in their COVID-19 vaccine, Vaxzevria. Group fourth quarter revenue was up just 1% on a constant currency basis, however, when Vaxzevria is stripped out of the numbers, revenue from Astra’s remaining products rose 17%.

“A big drop in COVID vaccine sales is part of the larger COVID cliff that is may impact the industry in the short term,” said Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown.

“Growth was also boosted by the acquisition of rare disease specialist Alexion. Perhaps it’s no surprise that 2023 guidance is for a more muted year with total revenue guidance in the low to mid-single digit range. Excluding COVID medicines this creeps into double digits.”

In addition, AstraZeneca were confident in the quality of their pipeline which rounded off a generally robust release from the £166bn FTSE 100 stalwart.

AstraZeneca shares were 4.5% higher at the time of writing on Thursday.

“2022 was a year of continued strong company performance and execution of our long-term growth strategy,” said Pascal Soriot, Chief Executive Officer, AstraZeneca.

“We made excellent pipeline progress with a record 34 approvals in major markets and we are initiating new late-stage trials for high potential medicines such as camizestrant, datopotamab deruxtecan and volrustomig.”

British American Tobacco share were weaker on Thursday despite strength in their New Categories unit and a 6% dividend hike.

Total group revenue rise 7.7% to £27.6bn in 2022 and operating profit grew 2.8% to £10.5bn.

The group said they were confident their vapes and no-tobacco business would hit £5bn by 2025 as volume growth continued. However, it was weakness in their traditional combustibles core business causing concern with sluggish growth and further contraction of the market predicted.

“It’s hard to tell how much of this came from smokers feeling the squeeze of rising prices, and how much came from a drive by smokers to become more healthy,” said Derren Nathan, head of equity research at Hargreaves Lansdown.

“BATS’ cigarette brands include the likes of Rothmans, Camel and Newport. Despite the significant fall in volume of its biggest sales category, profits have done well. This has been helped by cost savings and strong pricing.”

Cash generated from operating activities grew 7% in the period and BATS said they were hiking their dividend by 6%.

“Another year of 100% cash conversion underpins the 8% dividend yield as well as investment in new categories but we note the statement of intent around debt repayment, with improved balance sheet strength now a priority. In the short term we see further approvals of US pre-market tobacco product applications (PMTAs) for new categories as pivotal to investor sentiment,” Nathan said.