Thursday May 8, 10:57 AM
London midmorning: Footsie lower ahead of rate decision
LONDON (ShareCast) - London's top stocks are still stuck lower ahead of the midday decision on interest rates. Enterprise Inns (LSE: ETI.L - news)
is lower following yesterday's 29% jump on news that the pub owner is eligible to convert to a low tax real estate investment trust (REIT) if an internal restructuring of the group is undertaken. Morgan Stanley (SPU - news) lowered its recommendation on the company to 'equal-weight' from 'overweight' following the surge. Fellow pub group Punch Taverns (LSE: PUB.L - news) , meanwhile, is doing well after it said late yesterday that it continues to consider the opportunity of a potential conversion to REIT status on its merits. Old Mutual (LSE: OML.L - news) slips after sales improved by a less than expected 2% in the first quarter to £426m due to disappointing UK sales and market volatility, which hit sales of unit trusts. Fellow insurers Admiral and Standard Life (LSE: SL.L - news) are also lower. Mobile phone retailer Carphone Warehouse (LSE: CPW.L - news) is to sell a 50% stake in its retail business for £1.1bn to US consumer electronics retailer Best Buy and the two groups will form a new company. Household goods giant Unilever (LSE: ULVR.L - news) is the biggest riser after posting a 7.2% rise in first quarter underlying sales, ahead of forecasts. High street fashion chain Next leads the retail sector higher even after sales fell 3.9% to £738.9m in the first quarter, with the group cautious about the outlook given the soaring cost of food, fuel, mortgages and taxes. Next Directory held up better, with sales off 1% to £220.8m. Business software giant Sage reported first-half growth that was in line with management expectations except for the troublesome Sage Healthcare Division in North America. Insurer Royal & Sun Alliance reported a 15% rise in net written premiums to £1.721bn in the first quarter and said it remains confident of achieving a strong result in 2008 and beyond. Spirits group Diageo (LSE: DGE.L - news) has maintained full year guidance for 9% organic operating profit growth in the year ending 30 June 2008 after a trading in the third quarter continued in line with the first half. In the nine months to 31 March, organic net sales growth was 7%, as expected. Miner Lonmin (LSE: LMI.L - news) is among the top risers after it reported a 63% hike in first-half underlying earnings per share to 132.5 cents thanks to bumper platinum prices. So is Chilean miner Antofagasta (LSE: ANTO.L - news) which has reached a settlement with local farmers regarding the el Mauro tailings dam at its Los Pelambres mine. Ferrochrome producer Eurasian Natural Resources Corporation (LSE: ENRC.L - news) was back on the acquisition trail Thursday, buying a 50% stake in a Chinese ferroalloys producer. Enodis (LSE: ENO.L - news) is leading the FTSE 250 (news) risers after the group, which makes restaurant equipments for McDonalds, has agreed to be taken over by Illinois Tool Works for £1.029bn. Investment bank Close Brothers has kept its outlook broadly the same as it was at the end of the first half, with uncertain market conditions set to affect the securities and corporate finance divisions. Newspaper publisher Trinity Mirror (LSE: TNI.L - news) said the advertising environment remains difficult and volatile as it posts a 3.1% decline in advertising. There have been more gains for TT electronics (LSE: TTG.L - news) today as the sensor and electronic components firm bagged a contract with the US armed forces worth $90m over the next five years. Oil explorer Sibir Energy (LSE: SBE.L - news) said total production in the first quarter rose 50% to a record 5.9m barrels compared to the same period last year.
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