Rio Tinto agrees to buy Arcadium Lithium, Mondi to buy Schumacher Western Europe

London open

The FTSE 100 is expected to open 22 points higher on Wednesday, having closed down 1.36% on Tuesday at 8,190.61.

Stocks to watch

Rio Tinto said on Wednesday that it had struck a deal to buy Arcadium Lithium for $6.7bn, placing it among the main producers of the key component of electric vehicle batteries. The mining giant on Wednesday said it was offering $5.85 a share in cash - a 90% premium to the stock’s closing price at the end of last week.

Paper and packaging giant Mondi has announced the acquisition of the Western European corrugated converting and solid board assets of Schumacher Packaging. Mondi said the deal will expand its corrugated footprint in key markets and add complementary fibre-based products focused on ecommerce and FMCG to enhance its existing offering. The assets, purchased for an undisclosed sum, generated €66m in adjusted EBITDA in 2023.

CMC Markets said in an update on Wednesday that it expects net operating income of £180m for the first half, a 45% increase from the prior year, alongside a profit before tax of £51m, a significant turnaround from a £2m loss a year ago. The FTSE 250 company said operating costs, excluding variable remuneration and one-off charges, were projected to decrease 7% to £113m. It attributed its performance to its diversification strategy, growth in the B2B segment, and steady client trading activity, as it prepared for the launch of its UK cash ISAs launch and made progress in onboarding Revolut clients.

Newspaper round-up

The UK advertising watchdog has cracked down on marketing campaigns by telecoms companies including BT, EE, Virgin Media and O2 for misleading consumers about price rises added to their bills during their contracts. The Advertising Standards Authority (ASA) has issued a batch of rulings against ads run by BT, its subsidiaries EE and Plusnet, as well as TalkTalk, O2 and Virgin Media broadband. – Guardian

Boeing said on Tuesday that it had withdrawn its pay offer to about 33,000 US factory workers and no further negotiations were planned with their union representatives as a strike nears its fourth week. Boeing and the union held their latest round of negotiations with federal mediators on Monday and Tuesday, but talks collapsed and the sides were left locked in acrimonious stalemate showing no signs of being resolved anytime soon, a person briefed on the talks said. – Guardian

Jobs with zero-hours contracts attract 25pc more applicants than equivalent permanent roles, research has found, as Angela Rayner plots a crackdown on the controversial working arrangements. Academics at the London School of Economics (LSE) found workers on zero-hours contracts had “a very strong preference” for their set-up and were “willing to forgo some salary for the flexibility their contract offers.” – Telegraph

More than two in five employers say they will cut their staff pension contributions where they can if the chancellor introduces national insurance on them in the budget this month. An informal poll of more than 600 employers found 42 per cent of those that pay more than the statutory minimum would reduce their contributions. – The Times

When Diversified Energy joined London’s junior market seven years ago, it positioned itself as a rare and different prospect from the other oil and gas minnows. The American producer pledged to hand back bumper cash returns to investors, backed by a steady stream of cash from the unloved gas wells of the energy majors. The assurance was met with scepticism by some analysts even then, but for a time the company defied its critics, helping to propel its market value from just under £70 million at its admission to Aim to £1.1 billion in 2022. – The Times

US close

US stocks finished higher on Tuesday, with the Nasdaq outperforming the other main benchmarks as all Magnificent Seven heavyweights advanced.

The Dow rose 0.3%, rebounding slightly after retreating sharply from a record high the previous session, while the S&P 500 gained 1% and the Nasdaq jumped 1.5%.

Nevertheless, global equity markets were volatile earlier in the day after China’s National Development and Reform Commission underwhelmed failed to deliver more stimulus measures at their conference, causing stocks with heavy exposure to China to drop.

Markets in mainland China rose strongly as traders returned to their desks following the Golden Week break, while the Hang Seng index in Hong Kong – which stayed open during the week-long holiday – tumbled 9.4%.

Oil prices were pulling back sharply on Tuesday after surging to a six-week high the previous session.