Friday May 16, 10:29 AM
London shares up midmorning; oils and British Airways rise
LONDON (Thomson Financial) - Leading shares were higher midmorning as oil shares made further gains on a higher crude price, British Airways (LSE: BAY.L - news) rose on paying a dividend British Energy Group was up on bid talk.
At 10:04 a.m., the FTSE 100 index was 73 points higher at 6,324.8, near the session high of 6,329.5. The FTSE 250 index was ahead 174.7 points at 10,513.6.
David Evans, market analyst at BetOnMarkets.com, said: 'The U.S. has been leading the way in pushing the UK up. Also, there's a feeling that the bad news on the credit crunch is out now, and things are not as bad as feared.'
Brent crude for July delivery was 77 cents higher at $123.40 midmorning. This helped the FTSE 100's oil shares go higher. Index heavyweight BP (LSE: BP.L - news) was up 6 at 631-1/2, Royal Dutch Shell (Amsterdam: RDSA.AS - news) was up 16 at 2,075; BG Group (LSE: BG.L - news) was up 16 at 1,324; Cairn Energy (LSE: CNE.L - news) was up 25 at 3,557 amd Tullow Oil (Dublin: TQW.IR - news) was up 10 at 934-1/2.
While higher oil prices have been a factor in depressing the share price of British Airways, the shares were up 14 at 238, making it the top FTSE 100 riser midmorning, after the group posted a 44.5 percent rise in its full-year pretax profit and said it would pay a dividend.
For the year to March 31, 2008, BA said its pretax profit rose to 883 million pounds from 611 million last year.
Deutsche Bank (Frankfurt: DB9999 - news) reiterated its 'buy' rating.
In M&A news, Interdealer broker ICAP (LSE: IAP.L - news) was 26 higher at 661 on reports that Intercontinental Exchange, owner of London's crude oil exchange, is interested in making a bid.
British Energy Group was 36-1/2 higher at 716-1/2 after it said it has received a number proposals from parties wanting to make full offers for the company, but said any decision will be delayed for a number of weeks because the proposals need 'further development'.
National Grid (LSE: NG.L - news) gained 11-1/2 to 727-1/2 after Credit Suisse reiterated its 'neutral' recommendation and 880 pence target price on the group and said the stock is a 'trading buy' after 'strong' full-year results on Thursday.
Sticking with broker news, Compass Group (LSE: CPG.L - news) rose 8-1/4 at 364-1/2 as Goldman Sachs (NYSE: GS - news) upgraded the company to 'neutral' from 'sell', following first-half results from the contract caterer on Wednesday.
Supermarket group J Sainsbury was the only stock in the FTSE 100 down more than 1 percent midmorning. It was 7-1/2 lower at 370, extending losses for the week after Wednesday's disappointing full-year figures.
In the midcaps, Petrofac (LSE: PFC.L - news) was up 22 at 650-1/2 after the group said it expects net profit for 2008 to be at the top end of market expectations.
And, Ladbrokes (LSE: LAD.L - news) gained 8-1/2 at 318-1/2 as it announced profits from continuing operations, excluding high roller activity, increased 13 percent in the first four months of 2008.
Brokers were generally positive about the results, but Merrill Lynch (NYSE: MER - news) and Arbuthnot remained 'neutral' and Landsbanki maintained its' reduce'.
Some brokers said they still preferred rival William Hill (LSE: WMH.L - news) , up 10-1/2 at 378.
Meanwhile, Capital & Regional was 21-3/4 higher at 356-3/4 after the group said its underlying tenant facing business remains resilient with all indicators within their normal trading range and that its plan to raise new equity within its community shopping centres 'The Mall' has progressed well.
Turning to the downside, Rightmove (LSE: GB00B0MFTM73.L - news) was off 19-1/4 at 366-1/4 as the group said it is to place up to 16.2 million shares via accelerated bookbuilding.
Finally, a broker downgrade left shares in Logica 3-1/2 lower at 124 after Goldman Sachs downgraded the group to 'sell' from 'neutral' while reiterating its 120 pence target price, following its recent share price rally.
Finally, JKX Oil & Gas was 19-1/4 lower at 489-3/4 after said both oil and gas production in the first quarter was lower than a year ago.
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