Market Report: Autonomy races ahead thanks to US peers

News from the US gave Autonomy a shot in the arm yesterday, as the software company was boosted on the read-across after a number of its peers across the Atlantic released encouraging figures.

During what was described by George O'Connor of Panmure Gordon as a "blistering night on Wall Street", Accenture, Oracle and RIM all revealed numbers that beat expectations and resulted in raised forecasts.

Although Mr O'Connor was cautious about the benefits for the whole sector on the London Stock Exchange, noting that the three groups are "leaders in their particular segments", he picked out Autonomy as the "most obvious beneficiary". As a result, he reiterated his "buy" recommendation and upped the software company's target price to 1,726p from 1,693p.

In response Autonomy spent the day leading the top-tier companies, and by the bell it had put on 78p to finish on 1,543p. The group was also helped recently by further gossip that it is being lined-up as a potential takeover target, with Oracle and Microsoft both mentioned.

Overall the FTSE 100 edged down 9.37 points to 5,871.75, bringing to an end the last full week of trading before Christmas.

The banks suffered some of the worst losses after Moody's downgraded Ireland's credit rating by five levels to "Baa1". Lloyds Banking Group's revelation that it is facing further impairment losses from its Irish portfolio meant it dropped 2.46p to 66.5p.

Royal Bank of Scotland was also down, shedding 2.3p to 37.82p, on the day that the Bank of England's Financial Stability Report warned of the threat to the banking sector from the eurozone's financial difficulties.

The wooden spoon was taken by AstraZeneca, as the pharmaceutical company failed to win approval from the US Food and Drug Administration for its product Brilinta. The FDA said it needed more information before it could give the go-ahead. And because a green light was generally expected, the group plummeted 212p to 2,941p.

Dr Mike Mitchell of Seymour Pierce kept his "reduce" advice on the company, saying that the "impact of development and regulatory risk is under-estimated by the market." Meanwhile, Richard Curr of Prime Markets described AstraZeneca as "a quality global pharma play", but said the setback "has created a short-term window of opportunity for traders to short-sell the shares".

Sage moved 3.6p downwards to 275.8p as the French payment solutions group Ingenico had its shares suspended after receiving a takeover approach worth €1.44bn (£1.23bn). Although the identity of the bidder was not revealed, speculation has often named Sage as a company interested in Ingenico.

Faring better yesterday were the real estate investment trusts, after Steve Bramley-Jackson of Credit Suisse picked out British Land as one of his "key picks". It put on 7p to 516p in response, while Hammerson added 2.7p to 419.6p following Mr Bramley-Jackson's praise for the sector.

Meanwhile real estate companies on the mid-tier index were also helped, on this occasion by Barclays Capital. Derwent London and Great Portland Estates were given an "overweight" rating, and advanced 8p to 1,539p and 2.6p to 354.4p. Capital & Counties was labelled with the same advice, but it did not move from 146.5p.

Punch taverns was one of the best performers on the FTSE 250, after it said it expected to meet its targets for the full year. Despite Altium Securities pointing out that overall the update was "largely as expected", the pubs group moved up 7.8p to 74.45p.

Investors welcomed ITE's announcement that it had spent £28m on MVK, a Russian peer which runs a number of exhibitions in the country. The news led it to climb 25.8p to 244.1p, with Numis forecasting that the company could "benefit from cyclical recovery in MVK's events and drive international sales to what are currently predominantly local events."

Meanwhile positive forecasts helped both National Express and Melrose Resources, and they made 15.6p to 242.8p and 30.1p to 248.1p respectively. The transport company said that it was on track to beat its expected full-year profits, while Melrose Resources predicted that its daily production rate will rise by nearly 25 per cent.

Among the small-cap companies, Tribal Group put on 4.5p to 46.5p after it revealed that it had received a takeover approach, its second in the last few months. The outsourcing company refused to release any further details, and warned there was "no certainty... that an offer for the company will be made".

On the Alternative Investment Market, Madagascar Oil asked for trading in its shares to be suspended, which meant it stayed on 76.59p. It made the request after Madagascar's government said it wanted to take control of many of the oil company's licences for the island.

FTSE 100 Risers

Aggreko 1,534p (up 27p, 1.79 per cent)

Regains early losses following update in which it forecasts a 25 per cent rise in full-year pretax profit.

BT 182.4p (up 3p, 1.67 per cent)

One of the session's biggest gainers despite Nomura picking it as one of its "top Reduce ideas".

Petrofac 1,513p (up 23p, 1.54 per cent)

Up after trading statement in which it says it is bullish on its growth prospects.

FTSE 250 Risers

Avis Europe 231.7p (up 21p, 9.97 per cent)

Car rental group manages to reach its highest share price for over five months.

Sports Direct 152.8p (up 2.3p, 1.53 per cent)

Third day up in a row for the sportswear retailer, which released impressive figures on Thursday.

IMI 938.5p (up 14p, 1.51 per cent)

Slight move forward for engineering company, which will start trading on the FTSE 100 on Monday.

FTSE 100 Fallers

Cobham 198.7p (down 6.8p, 3.31 per cent)

Disappointing last day on the top-tier index before defence group moves down to the FTSE 250.

Smiths Group 1,235p (down 22p, 1.75 per cent)

Drops after it has its price target lowered by Nomura to 1,300p from 1,200p.

BP 467.15p (down 2.85p, 0.61 per cent)

Still falling after Wednesday's news that the US government is suing it over the Gulf of Mexico oil spill.

FTSE 250 Fallers

Dixons 24.35p (down 1.14p, 4.47 per cent)

Finishes bottom of the mid-tier index as UBS downgrades retailer to "neutral" from "buy".

SuperGroup 1,361p (down 54p, 3.82 per cent)

Bad end to a tough week for the fashion company, during which time it has fallen over 15 per cent.

Sportingbet 58.95p (down 0.15p, 0.25 per cent)

Gambling group sees small drop after it says trading remains in line with expectations.

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