Market Report: Carnival still in choppy waters

 

Ripples from the deadly capsizing of the Costa Concordia off the coast of Italy in January were still being felt by cruise ship owner Carnival yesterday.

The group, which is dual-listed in the US and London, reported continued signs of sea sickness as its profits and sales were below forecasts. It is still suffering from the effects of the disaster as fewer people decide to take cruises, and bookings for 2013 are still below last year.

Carnival, which runs Carnival Cruises and Holland America, missed analysts' forecasts for the full year and reported profit of $93m (£57m) on sales of $2.66bn, down from profit of $217m on sales of $2.82bn a year earlier.

Back in October investors had thought the worst was over when its US rival Royal Caribbean raised its full-year forecasts. But yesterday's update left Carnival's shares down 154p at 2,391p, finishing at the bottom of the index .

The blue-chip table was desperately trying to hang on to the previous day's gains, and managed to stay in positive territory until lunchtime – giving hope that the so-called "Santa Rally" could take the index to the coveted 6,000 mark by the end of the year.

An update that the US economy has grown more than expected failed to lift the mood after lunch in London and investors remained fixated on the talks about resolving the US fiscal cliff. News that these talks may have reached a stalemate sent the FTSE 100 index down 3.25 points to close at 5,958.34.

Stocks still propping up the benchmark index included engineer Weir Group, which has bought Mathena for $240m. Mathena, which provides equipment and services for oil and gas drillers, will help Weir's move into the US shale gas market.

Investec raised its price target to 2,100p and rated Weir a buy. The group has been the subject of bid chatter earlier this year with rumours that General Electric could be interested. But the rumours remained vague. The shares gushed up 51p to 1,863p.

ITV found itself at the top of the table as investors tuned in to its plans for recovery. Analysts at Galvan rated it a "buy" the previous day and the shares broadcast a 3.2p gain to 107p.

Nomura's David Hayes upgraded his price target for British American Tobacco. He thinks the group will "see the strongest organic profit development" of the sector and he raised his target to 3,880p, rating the shares a buy. But he retains Imperial Tobacco as reduce – or sell – with a target of 2,510p. BAT puffed up 15p to 3,110p and Imperial was static at 2,397p.

Could Dairy Crest be looking at stocking up its food cupboard next year? That's what Investec thinks, and Nicola Mallard at the broker reckons the milk-to-cheese group could have £100m in the kitty to feed its hunger.

Dairy Crest's shares closed at an 18-month high of 400p earlier this week, and Ms Mallard upgraded her forecasts and increased her target to 420p, rating the shares a buy.

She said the "stock has had a decent run since the release of its interim results" and the company's cost-cutting plan has convinced her to think the outlook could be better for the dairy group next year.

The company survived the milk-pricing row earlier this year, and Ms Mallard thinks it has up to £100m to spend following the sale of its French spread business St Hubert.

"It is clearly conscious it needs to spend wisely – it is replacing earnings from a very attractive business [St Hubert] and any deal also needs to enhance the growth profile of the group, all without overpaying," she said.

The group, whose brands include Cathedral City cheese, was the subject of takeover speculation at the beginning of the year after Müller snapped up rival Robert Wiseman Dairies, but for now analysts think it is more likely to be acquirer than acquired. The shares lost 6.4p to 393.6p yesterday.

The small-cap medical device maker Consort Medical has flogged King, which specialises in devices for airways, to Ambu of the US. Investec's Sebastien Jantet said the £105m price tag is well ahead of the £55m value he had attached to King, and "it should add at least 70p to the share price". The company's shares ticked up 29p to 820p.

AIM-listed Bridge Energy updated the market on its Asha oil discovery in Norway with partners Eon and Wintershall and its share price spurted up 5.5p to 105.5p.

Buy

Centamin

Snaffle some shares in gold miner Centamin, analysts at Westhouse suggest. The Egyptian-focused miner has had to deal with a series of problems but yesterday it confirmed its operations are now fully up and running at its Sukari mine. Westhouse's experts think that while the issues have eased "we anticipate that the company could encounter additional problems". They still think it is worth buying at 65p but it "is not a stock for the risk averse". The stock rose by 1.25p to 42.71p yesterday.

Sell

Darty

Ditch shares in retailer Darty, scribes at JPMorgan recommend. There are pressures on both the top line and its margins and JPMorgan's analysts think in "the near term, conditions have continued to deteriorate". They give the stock a share price target of 40p. The shares lifted 1.75p to 60.25p.

Hold

Thomas Cook

Stop selling your shares in travel firm Thomas Cook, Peel Hunt's expert reckons – it is time to hang on to them. Peel's Nick Batram said: "This is the honeymoon period for new management and sentiment towards the stock is now focused on how far and how quickly the turnaround can be delivered." He upped his share price target to 41p, up from 10p. The shares rose 2.75p to 45.5p.

Start your day with The Independent, sign up for daily news emails
News
Legendary blues and rock singer Joe Cocker has died of lung cancer, his management team as confirmed. He was 70
people70-year-old was most famous for 'You are So Beautiful'
News
people
Sport
Chelsea manager Jose Mourinho
footballLatest score and Twitter updates
Arts and Entertainment
David Hasselhof in Peter Pan
The US stars who've taken to UK panto, from Hasselhoff to Hall
PROMOTED VIDEO
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Life and Style
Approaching sale shopping in a smart way means that you’ll get the most out of your money
life + styleSales shopping tips and tricks from the experts
News
newsIt was due to be auctioned off for charity
Life and Style
A still from a scene cut from The Interview showing North Korean leader Kim Jong-un's death.
tech
Environment
Sir David Attenborough
environment... as well as a plant and a spider
Voices
'That's the legal bit done. Now on to the ceremony!'
voicesThe fight for marriage equality isn't over yet, says Siobhan Fenton
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

The Jenrick Group: Night Shift Operations Manager

£43500 per annum + pension + holidays: The Jenrick Group: Night Shift Operatio...

SThree: Trainee Recruitment Consultant - LONDON

£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

SThree: Graduate Recruitment Consultant

£20000 - £25000 per annum + OTE £35000: SThree: SThree are a global FTSE 250 b...

Day In a Page

Surrounded by high-rise flats is a little house filled with Lebanon’s history - clocks, rifles, frogmen’s uniforms and colonial helmets

Clocks, rifles, swords, frogmen’s uniforms

Surrounded by high-rise flats is a little house filled with Lebanon’s history
Return to Gaza: Four months on, the wounds left by Israel's bombardment have not yet healed

Four months after the bombardment, Gaza’s wounds are yet to heal

Kim Sengupta is reunited with a man whose plight mirrors the suffering of the Palestinian people
Gastric surgery: Is it really the answer to the UK's obesity epidemic?

Is gastric surgery really the answer to the UK's obesity epidemic?

Critics argue that it’s crazy to operate on healthy people just to stop them eating
Homeless Veterans appeal: Christmas charity auction Part 2 - now LIVE

Homeless Veterans appeal: Christmas charity auction

Bid on original art, or trips of a lifetime to Africa or the 'Corrie' set, and help Homeless Veterans
Pantomime rings the changes to welcome autistic theatre-goers

Autism-friendly theatre

Pantomime leads the pack in quest to welcome all
The week Hollywood got scared and had to grow up a bit

The week Hollywood got scared and had to grow up a bit

Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

Panto dames: before and after

From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
Thirties murder mystery novel is surprise runaway Christmas hit

Thirties murder mystery novel is surprise runaway Christmas hit

Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

Anne-Marie Huby: 'Charities deserve the best'

Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
The botanist who hunts for giant trees at Kew Gardens

The man who hunts giants

A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there
The 12 ways of Christmas: Spare a thought for those who will be working to keep others safe during the festive season

The 12 ways of Christmas

We speak to a dozen people who will be working to keep others safe, happy and healthy over the holidays
Birdwatching men have a lot in common with their feathered friends, new study shows

The male exhibits strange behaviour

A new study shows that birdwatching men have a lot in common with their feathered friends...
Diaries of Evelyn Waugh, Virginia Woolf and Noël Coward reveal how they coped with the December blues

Famous diaries: Christmas week in history

Noël Coward parties into the night, Alan Clark bemoans the cost of servants, Evelyn Waugh ponders his drinking…
From noble to narky, the fall of the open letter

From noble to narky, the fall of the open letter

The great tradition of St Paul and Zola reached its nadir with a hungry worker's rant to Russell Brand, says DJ Taylor
A Christmas ghost story by Alison Moore: A prodigal daughter has a breakthrough

A Christmas ghost story by Alison Moore

The story was published earlier this month in 'Poor Souls' Light: Seven Curious Tales'