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London afternoon: Footsie holds above 5,600
Tue, 07 Feb, 2012
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London afternoon: Footsie holds above 5,600
Thu, 11 Mar 2010, 14:52:00
A steady decline continued through lunch, but London bounced off 5,600 despite a weak start on Wall Street as mining sector losses narrowed very slightly. Falling commodity prices have damaged miners Thursday. Investors decided to take profits in <b>Fresnillo, Randgold, Rio Tinto, ENRC, Kazakhmys, BHP Billiton </b> and <b>Xstrata</b>. <b>Smith & Nephew</b> is also under the weather after coming out on the wrong side of a patent trial result in the US. The UK medical devices maker was found by a US jury to have infringed two patents held by wound-care specialist Kinetic Concepts. South African insurer <b>Old Mutual</b> is also in the red despite resuming dividend payments following a better second half. The group is exploring the sale of US Life and a partial flotation of its US asset management business. A US Asset Management deal, which the firm said would bankroll growth, is expected within three years. Supermarket group <b>Wm Morrison</b> saw a sharp jump in profits in the year to 31 January as its value offering continued to attract customers during tough times. However, investors reacted to a slowdown in like for like sales growth and ditched the shares. Like for like sales excluding fuel and VAT were up by 6% in the year to 31 January, lower than the 8.2% growth seen the previous year and down from the 6.5% growth seen in the 6 weeks to 3 January 2010. On the upside, B&Q-owner <b>Kingfisher</b> received a leg-up from <b>Home Retail's</b> decent numbers. The Argos and Homebase operator said benchmark profit before tax for the year will be around £290m, slightly ahead of current market expectations. In the 8 weeks to 27 February, total sales at Argos fell 6.6% to £537m. Like-for-like sales declined by 9.4%, which included the approximate 3% negative impact of the later launch of the Spring/Summer catalogue, as well as an adverse impact of poor weather in this short and low volume period. <b>Thomas Cook</b> and <b>TUI Travel</b> are enjoying a spell in the sun after the former held an investor day yesterday. Thomas Cook outlined how it intends to 'move towards being a 5.5 - 6.0% earnings before interest and tax [EBIT] margin business over the next 3 - 5 years,' according to broker Panmure Gordon, which has a 'buy' recommendation and 315p price target on the stock. Thomas Cook believes the European online travel agency market offers it the chance to build a business with £3.0-£3.5bn of gross sales, 'translating into £400-£450m of revenues with margins on a par with market leaders (Expedia, Priceline, Opodo and Orbitz)' Panmure Gordon said. Oil giant <b>BP</b> has beefed up its exploration operations with the acquisition of assets in Brazil, Azerbaijan and the Gulf of Mexico for $7bn. It will pay North America-focused oil and gas group Devon Energy $7bn for 10 exploration blocks in Brazil, exploration prospects in the US Gulf of Mexico and an interest in the BP-operated Azeri-Chirag-Gunashli (ACG) development in the Caspian Sea, Azerbaijan. Drug giant <b>AstraZeneca</b> announced a license and supply agreement with Indian peer <b>Torrent Pharmaceuticals</b>. Under the deal, Torrent will supply a portfolio of generic medicines for which it already has licenses in a range of countries. <b>JD Wetherspoon</b> reinstated its dividend as the pub group reported half year sales and profits at record levels. Pre-tax profit in the 26 weeks ended 24 January was £36.2m, an increase of 17.5% on a pre-exceptional basis (2009: £30.8m) and a jump of 41.4% (2009: £25.6m) after exceptional items. Regional newspaper publisher <b>Johnston Press</b> revealed a sharp decline in full year operating profit but said pressure on advertising revenues had started to improve in 2010. The constant nature of <b>Dignity</b>'s business helped the funeral service provider post a rise in revenues and profits in the year to 25 December. Pre-tax profits climbed to £37.5m from £35.4m on revenues that rose to £184.7m from £175.8m. Cinema operator <b>Cineworld</b> saluted the success of 3D films such as Avatar in drawing crowds to the cinema as it posted a rise in sales and profits. In the 53 weeks to December 31, pre-tax profits rose to £30.8m from £27.6m over the previous period as revenues rose to £333.4m from £298.9m. IT infrastructure services provider<b> Computacenter</b> reported a better than expected 26% rise in full-year pre-tax profit and said it enters 2010 in good shape. Adjusted pre-tax profit increased to £54.2m in the year ended 31 December compared with £43.1m in the previous period. However, revenues decreased slightly to £2.50bn from £2.56bn. <b>Premier Oil</b> has found oil at its wildcat well 34/5-1 S on the Norwegian Blåbaer exploration, near the Snorre field in the North Sea, although another target area turned out to be dry. Shares in security camera firm <b>Indigovision</b> fell sharply after it said first half profit was unchanged from the previous year and added that the economic backdrop remains uncertain.
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