Market News - London

LONDON (ShareCast) - After yesterday's shake-out London has so far experienced a morning of calm to the extent that traders may as well join their transatlantic counterparts and take the day off to celebrate US Independence Day.

Friends Provident is the worst performing blue-chip. The demerger of the group's 52% stake in F&C Asset Management and the related reduction of capital of Friends Provident was approved by the courts yesterday. The company intends to distribute its F&C shares to accepting Friends Provident shareholders today; members of the CREST paperless shares system should see the shares credited to their accounts on Monday morning at 8:00am.

Resource stocks are friendless as might be expected as commodity prices fall. Rio Tinto (LSE: RIO.L - news) , Kazakhmys (LSE: KAZ.L - news) and Vedanta are the big fallers in the mining sector while Petrofac (LSE: PFC.L - news) and Cairn Energy (Virt-X: CNE1.VX - news) are the worst hit of the oil related stocks.

BHP Billiton (LSE: BLT.L - news) has agreed to sell its Yabulu nickel refinery for an undisclosed sum after writing down its value by US$675m.

Engineer and construction contractor Balfour Beatty (LSE: BBY.L - news) is lower after a trading update. The company has traded in line with expectations since its previous update in May. It attributed the steadiness of the ship to continued infrastructure spending by customers, acquisitions and tight control of costs.

Resource stocks get a lift from Credit Suisse, which has upgraded the European media sector to "overweight". Publishers Reed Elsevier (Amsterdam: 273044.AS - news) and Pearson (LSE: PSON.L - news) plus pay-TV provider BSkyB (LSE: BSY.L - news) all head higher.

Oil and gas firm Salamander has spudded the Phu Kheng-1 exploration well in Block L27/43, Northeast Thailand. "Phu Kheng-1 has the potential to open up a new play in the Khorat basin," said chief executive James Menzies.

Ireland's premier bank, Bank of Ireland (Dublin: BIR.IR - news) , has warned it is facing a squeeze on profit margins in addition to the huge impairment charges it will take this year and next. "Demand for new lending remains muted and the lower interest rate environment together with the impact on deposit pricing of more intense competition has resulted in pressure on liability spreads," it said in a trading update.

Irish building supplies firm Grafton said the recent tough conditions have impacted its profitability "severely", with revenues down 31% in the first half of the year.

Five-a-side football pitch operator Goals Soccer continues to trade in line with expectations despite severe snow in February, which reduced interim sales and profits by approximately £300,000 in the six months to June.

European Islamic Investment Bank (EIIB), the Sharia compliant investment bank, responded to the recent surge in its share price and admitted that it had received approaches. "The board of EIIB notes the recent movement in its share price and announces that it has received a number of preliminary approaches from third parties," said the group EIIB's share price has surged 40% in the last two days.

IT services firm Morse (LSE: MOR.L - news) is top of the TechMark charts. Revenue and adjusted earnings before interest and tax (EBIT) will be towards the upper end of analyst expectations for the year, it said.