UK Market News

Thursday July 30, 12:51 PM
Glance-FTSE up 1.3 pct driven by earnings; BT strong

By Jon Hopkins LONDON, July 30 (Reuters) - Britain's leading share index was up 1.3 percent by mid-session on Thursday as investors took heart in better-than-expected earnings from companies such as BT Group, with miners also lending support to the market. By 1111 GMT, the FTSE 100 was 58.65 points firmer at 4,606.18, having gained 18.69 points on Wednesday and resuming its advance after snapping a two-week winning streak on Tuesday. The index has gained over 31 percent since hitting a six-year low in March, but is still down 2.6 percent in 2009. 'Traders are looking at 4,680 as a target. If we can break above this range then upwards momentum could continue. Until then however, movements are likely to be limited and trading may be choppy,' said market strategist Joshua Raymond at spreadbetters City Index. BT Group (LSE: BT-A.L - news) was the top FTSE 100 gainer as the fixed-line telecoms firm posted a smaller-than-expected 3 percent dip in first-quarter adjusted core earnings and said it was on track to deliver cost cuts after a 'solid' start to the year. Cazanove's rating upgrade to 'in-line' from 'underperform' helped boost BT shares gains further to 9.6 percent. Drugmakers also lent strength to the market on one of the year's busiest days for earnings reports. AstraZeneca (LSE: AZN.L - news) shares gained 2.3 percent after the group raised its full-year earnings forecast and posted healthy second-quarter results, helped by the absence of generics to heart drug Toprol XL and cancer treatment Casodex. Peers GlaxoSmithKline and Shire (LSE: GB00B0KQX869.L - news) added 0.8 percent and 0.5 percent respectively. Miners provided the biggest prop for the blue chips as copper prices rose slightly after a sell-off on Wednesday, with Rio Tinto (LSE: RIO.L - news) , BHP Billiton (LSE: BLT.L - news) , Xstrata (LSE: XTA.L - news) , and Eurasian Natural Resources adding 1.3 to 2.7 percent. Chilean copper miner Antofagasta (LSE: ANTO.L - news) gained 5.1 percent after reporting a 6.6 percent dip in first-half copper production, slightly better than expected. Platinum miner Lonmin (LSE: LMI.L - news) was another strong performer, up 3.6 percent as Citigroup (NYSE: C - news) upgraded it to 'buy' from 'hold'. Energy stocks also gained, with BP up 1.1 percent, Tullow Oil (LSE: TLW.L - news) ahead 0.7 percent, and Cairn Energy (Virt-X: CNE1.VX - news) adding 1.0 percent, helped by a firming crude price But Royal Dutch Shell slipped back from earlier gains, turning flat as investors booked some profits after a better-than-feared 70 percent fall in the oil major's second quarter net profit. REED ELSEVIER HAMMERED Reed Elsevier (Amsterdam: 273044.AS - news) was the biggest blue chip faller, dropping 13.9 percent as the Anglo-Dutch publisher ditched its 2009 earnings per share guidance and unveiled plans to issue new shares to pay down debt. Multi-utility Pennon also fell back, losing 4.5 percent after accompanying an in-line trading update with plans to issue 120 million pounds in convertible bonds. Other utility stocks such as Severn Trent (LSE: SVT.L - news) , United Utilities, and Scottish Southern Energy fell, and gas distributor Centrica (LSE: CNA.L - news) lost 2.8 percent after its first-half results failed to excite was the top FTSE 250 (news) riser, up 8.7 percent after the builders and home improvements group beat first-half profit forecasts and said its markets were stabilising. UK house prices rose for a third month running in July, the Nationwide Building Society said on Thursday, providing further evidence that property prices may have stabilised despite low turnover. This helped plumbing supplies group Wolseley (LSE: WOS.L - news) gain 7.4 percent. (Editing by Marie Maitre) Keywords: MARKETS BRITAIN STOCKS