IWG shed 20p from its share price after US private equity firm CC Capital Partners said it would not make a takeover bid for the London-listed office space provider.
The WeWork rival had surged as high as 325.2p on Tuesday morning, after Sky News said the two companies were holding secret talks about a potential offer. But as hopes for a deal evaporated, IWG’s shares dropped back to close at 307.7p, still up 2.5pc on the day.
Homebuilders were among stocks pushing the FTSE 100 higher throughout the day, after lender Nationwide said UK house prices rose by 13.4pc in June, compared to the same month last year, in the biggest annual increase since November 2004.
The FTSE 100 rose 14.58 points to 7,087.55 by the end of the session, with the index buoyed by Kingfisher, which climbed 5.5p to 367.5p, Persimmon, which lifted 46p to £29.81, and Taylor Wimpey, which inched 1.8p higher to 162.3p
The FTSE 250 surged to highs of 22,654.69 before falling back to finish the day just 8.75 points higher than Monday’s close, at 22,542.17.
Among the UK’s mid-cap stocks, UDG Healthcare shares received a small 3p boost, after US private equity firm Clayton, Dubilier & Rice agreed to buy the company for £2.8bn in cash, amounting to £10.80 per share. The stock, which has climbed 37pc this year, closed at £10.69.
Brent crude increased 0.37pc to $74.96 per barrel. Sterling, however, dipped to its lowest price in over a week against the dollar, with the currency on track for its worst month since September.
The pound finished the session at $1.3849, as investors continued to tread water between $1.38 and $1.40 due to uncertainty about the impact of the Indian coronavirus variant, which is pushing Scotland’s cases close to their January peak.
The spread of the Indian variant also increased the pressure on airliner Tui, which fell 19.4p to 364.7p – after dropping 17pc throughout June.
Michael Hewson, chief market analyst at CMC Markets, said: “Travel and leisure are once again feeling the heat after Spain removed UK visitors from their list for restriction-free travel with Tui seeing the largest losses, but Ryanair, easyJet and IAG also lower. Rolls-Royce is also underperforming, as its target of achieving wide-body engine flying hours of 55pc of 2019 levels starts to look increasingly difficult to hit.”
Meanwhile, several companies that investors predicted would be busy during and after England’s European Football Championship game against Germany received an afternoon boost.
Just Eat surged 257p to £68.75, its highest in a month. Pizza chain Domino’s and betting company Flutter also rose 1.2pc and 0.75pc.
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