Thursday May 8, 05:19 PM
London shares close touch higher, miners offset weak banks; Wall St ahead UPDATE
(Updates with full report)
LONDON (Thomson Financial) - Leading shares closed a touch higher as firmer trade on Wall Street and a mining sector buoyant on takeover talk helped to offset a weak banking sector following the Bank of England's decision to keep interest rates steady.
The FTSE 100 index closed 9.8 points up at 6,270.8, while the FTSE 250 (news) index added 101.2 points to 10,549.8.
On Wall Street, U.S. stocks rose modestly as investors reacted to a moderate pullback in oil prices and sifted through sales figures from retailers that were generally not as gloomy as anticipated.
At the UK close, the Dow Jones Industrial Average was up 62.60 points to 12,877.00, the Nasdaq Composite (NASDAQ: news) 15.59 higher at 2,454.08, and the S&P 500 index 4.32 ahead at 1,396.89.
In London, banks continued to weigh on the Footsie (news) after the Bank of England opted to keep its benchmark Bank Rate unchanged at 5.00 percent, despite a series of soft data in the run-up to its Monetary Policy Committee meeting. And talk Swiss peer UBS (Virt-X: UBSN.VX - news) could be banned from operating in the U.S. also weighed on sentiment surrounding the sector.
Barclays (LSE: BARC.L - news) led the banks lower, down 12 pence at 463, while Lloyds TSB slipped 5-3/4 to 443-3/4, Royal Bank of Scotland (LSE: 91ID.L - news) lost 6-3/4 to 357-1/4 and HBOS (LSE: HBOS.L - news) fell back 6 to 513-1/2.
The main faller, however, was Carphone Warehouse (LSE: CPW.L - news) as recent talk of takeover interest from Vodafone (LSE: VOD.L - news) turned to vague rumours that only part of the company -- likely its fixed line business TalkTalk -- would be sold.
The company earlier announced it will sell 50 percent of its retail operations to Best Buy for 1.1 billion pounds. Carphone shares fell back 10-1/4 pence to 289.
Enterprise Inns (LSE: ETI.L - news) was also under pressure as the stock gave back some of Wednesday's 29 percent gains with a fall of just over 2 percent Thursday.
The shares dropped 11 pence to 499 as Morgan Stanley (SPU - news) and Numis Securities both downgraded their recommendations -- to 'equal-weight' from 'overweight' and to 'hold' from 'add' respectively -- on valuation grounds following yesterday's news it is eligible to convert to a real estate investment trust (REIT).
British Airways (LSE: BAY.L - news) was another blue-chip casualty, 3-1/2 pence weaker at 238-1/2, as the high oil price continued the hurt the fuel consumer. The national carrier reports its full-year numbers next Friday.
Among those reporting results Thursday, Anglo-South African Old Mutual fell 1.4 pence to 124.8 pence after disappointing earning news.
The group said that it will struggle to reach its target of 300 billion pounds of funds under management for the end of 2008, after reporting first-quarter sales figures that missed analysts' forecasts.
But on the upside, investors cheered figures from Next, Unilever (LSE: ULVR.L - news) , and Sage Group (LSE: SGE.L - news) .
Shares in Next added 74 pence to 1,302 after the high street and catalogue fashion retailer's first-quarter trading update was no worse than feared.
In response, Seymour Pierce upgraded its investment stance from 'hold' to 'buy', Landsbanki reiterated its 'hold' recommendation and Sanford Bernstein repeated its 'market perform' stance.
Unilever rose 90 pence to 1,752 after it reported first-quarter sales growth that was ahead of market expectations and said it expects underlying sales growth for the full year to exceed its 3 percent to 5 percent target range.
And Sage took on 15-1/2 pence to 226-1/2 after the financial software company posted a higher-than-expected first-half pretax profit and said it is confident for the full year.
Results apart, miners surged ahead amid rising metals prices and spurious takeover rumours.
Gold prices reversed early losses as the dollar retreated from an eight-week peak against the euro and crude oil prices stayed near record highs, while market whispers mentioned a possible 2,500 pence bid from Eurasian Natural Resources for Kazakhmys (LSE: KAZ.L - news) , and Xstrata (LSE: XTA.L - news) interest for Alcoa (NYSE: AA - news) .
Kazakhmys jumped over 10 percent, or 176 pence to 1,914, Eurasian Natural Resources added 72 to 1,288, Xstrata took on 79 to 4,307, and Lonmin (LSE: LMI.L - news) investors shrugged off weak first-half numbers to boost the shares, up 196 at 3,408.
On the second line, food equipment maker Enodis (LSE: ENO.L - news) added more than 18 percent, up 44-3/4 pence at 288-1/4 after it agreed to be taken over by FNI Ltd., a unit of Illinois Tool Works.
The recommended cash offer of 280 pence a share values Enodis at 1.03 billion pounds, beating a previous offer from Manitowoc (NYSE: MTW - news) .
And Renishaw gained 39 pence to 769, boosted by a positive trading update that prompted UBS to raise its rating to 'neutral' from 'sell' and increase its price target to 740 pence from 570.
Among mid-cap fallers, ARM Holdings (LSE: ARM.L - news) fell 4-3/4 pence to 105 after Goldman Sachs (NYSE: GS - news) downgraded its rating to 'neutral' from 'buy' and Galiform (LSE: GFRM.L - news) shed 1-3/4 pence to 77-1/2 after Citigroup (NYSE: C - news) downgraded the group to 'sell' from 'hold' with the target price cut to 65 pence from 100.
|
|
|
Send Article by Email
Send Article by IM
Blog This with Y! 360
Printable View
