Morrisons rejects unsolicited private equity offer, TRIG finds turbine issues at Merkur

London open

The FTSE 100 is expected to open 22 points lower on Monday, having closed down 1.9% on Friday at 7,017.47.

Stocks to watch

UK supermarket chain Morrisons said it had rejected an unsolicited £5.5bn bid over the weekend from the US private equity firm Clayton, Dubilier & Rice, which had offered to pay 230p a share in cash. Morrisons’ share price closed at 178.45p on Friday, valuing the company at £4.3bn. The Morrisons board said the offer “significantly undervalued” the firm and its future prospects.

The Renewables Infrastructure Group said on Monday that routine inspections at the Merkur wind farm had identified signs of stress fatigue on the support structure of the Helihoist on some of the 6MW turbines. The FTSE 250 company said generation had been paused while the root cause was being investigated. It said the turbines were under warranty and service contract with the manufacturer, with the first batches of turbines now being brought back on line in consultation with authorities.

Newspaper round-up

The UK’s economic recovery accelerated in May as tourism and recreation firms reopened, but the delay in ending Covid-19 restrictions is putting hospitality firms at risk, research shows. Eleven out of 14 UK sectors reported faster growth in output month on month in May, up from nine in April, according to the Lloyds Bank UK Recovery Tracker, as the UK moved further out of lockdown. - Guardian

The government should prepare for a jump in inflation this year that will eat into household living standards and force more low-income families into poverty, according to the Resolution Foundation. Inflation is on course to rise above 4% in the next few months as the economy opens up and consumers begin to spend some of the savings they have built up over the past 16 months, the thinktank says. Rising prices will squeeze average household incomes by £700 by the start of next year with low-income families among the worst affected, it forecasts. - Guardian

A summer season wiped out by new Covid variants and Britain’s strict travel rules will trigger a sharp rise in eurozone unemployment unless governments extend furlough schemes, economists have warned. Forecasters at HSBC predicted at least half a million furloughed workers will lose their jobs once the region’s wage support schemes are wound down but cautioned that figure could rise. - Telegraph

Treasury officials are drawing up plans for a pensions tax raid in the autumn to help pay for heightened public spending during the Covid pandemic, The Telegraph understands. Three different reforms to the way in which pension contributions are taxed are being considered amid pressure on the public finances, according to well-placed Whitehall sources. - Telegraph

The activist investor that has bought a big stake in Aviva has defended its approach to overhauling companies days after calling on the FTSE 100 insurer to hand billions to shareholders. Cevian Capital said it tried to work constructively with the bosses of businesses where it was pushing for change. Writing in The Times today, Harlan Zimmerman, senior partner, said it “aims to create value that is shared with all shareholders and stakeholders”. - The Times

US close

Stocks were weaker at the close on Wall Street on Friday, with the Dow Jones Industrial Average down 1.58% at 33,290.08.

The S&P 500 lost 1.31% to 4,166.45, and the Nasdaq Composite was off 0.92% at 14,030.38.