LONDON (ShareCast) - British Airways (LSE: BAY.L - news) tops the gainers despite revealing that it carried 3.8% fewer passengers in
June. It added it will cut spending by 20% to deal with the challenging market conditions.
Traffic, measured in Revenue Passenger Kilometres, fell by 3.8% in June. Passenger capacity, measured in Available Seat Kilometres, was 1.7% below June 2008. The load factor, a measure of how well BA fills planes, was down 1.8% at 79.6%, while cargo traffic was down nearly 10%
The group said market conditions remain "very challenging" with trading at levels well below last year. But on an underlying basis, both premium and non-premium volumes and seat factors have been stable for more than three months, it said.
The demerger of Friends Provident's asset management subsidiary F&C has received court approval and has taken place today, resulting in a downward adjustment in the share price.
Broker Panmure Gordon believes that having offloaded its 52% stake in F&C Asset Management the life assurance company could well be involved in consolidation activity within the sector, though it suggests that had buy-out specialist Resolution been interested in Friends it would have made its move before the demerger.
Cornes rates the shares a "hold". "Although the valuation appears attractive with a 2009E dividend yield of 6%, we think that there are better opportunities elsewhere in the UK life sector, and would highlight Prudential and Aviva (LSE: AV.L - news) as the obvious switch candidates," Cornes concludes.
FTSE 100 - Risers
British Airways (BAY) 125.50p +5.46%
Reed Elsevier (Amsterdam: 273044.AS - news) (REL) 457.25p +3.92%
Barclays (LSE: BARC.L - news) (BARC) 297.00p +2.77%
Lloyds Banking Group (LSE: LLOY.L - news) (LLOY) 67.50p +2.43%
Royal Bank of Scotland Group (RBS (LSE: RBS.L - news) ) 38.78p +2.34%
British Sky Broadcasting Group (BSY) 464.50p +2.14%
Kingfisher (LSE: KGF.L - news) (KGF) 182.50p +1.84%
HSBC Holdings (LSE: HSBA.L - news) (HSBA) 509.00p +1.74%
FTSE 100 - Fallers
Friends Provident Group (FP.) 63.51p -6.73%
Land Securities Group (LAND) 443.50p -3.90%
Old Mutual (LSE: OML.L - news) (OML) 82.62p -3.39%
Fresnillo (LSE: FRES.L - news) (FRES) 500.50p -2.63%
Balfour Beatty (LSE: BBY.L - news) (BBY) 300.50p -2.51%
Kazakhmys (LSE: KAZ.L - news) (KAZ) 630.00p -2.48%
Petrofac Ltd (PFC) 667.50p -2.27%
Cairn Energy (Virt-X: CNE1.VX - news) (CNE) 2,295.00p -1.92%
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