Market Report: City puts a turbulent week behind it


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The Independent Online

Investors called the bottom for tumbling stocks yesterday as the City put a turbulent week behind it.

Around £29bn was added to the blue-chip index as markets around the world rallied. The recovery was across the board, with only 11 FTSE 100 companies in the red, but oil producers fared particularly well. Tullow Oil topped the index, up 40.1p at 524p, helped by an upgrade from Société Générale, which argued that its strong balance sheet and good control of spending meant it could weather the storm in oil prices.

Elsewhere Ophir Energy jumped 12.3p to 194.4p, EnQuest 4.05p to 76.75p, Cairn Energy 8p to 163p, Salamander Energy 8.5p to 83.5p and Leni Gas and Oil 1.3p to 4.77p.

The oil services provider Petrofac rose 72.5p to 1,060p after telling investors it is on track to hit full-year targets.

But David Madden, market analyst at IG, said the bright end to the week may not be a sign of a things to come: “I wouldn’t get too comfortable as next week is likely to be a rocky ride. The eurozone debt crisis has a history of rearing its ugly head, ebola has yet to be contained, China’s GDP report will tell us the golden days of Chinese growth are over. Confidence in equity markets takes months to be gained but it is lost in hours.”

The FTSE 100 closed up 114.38 points at 6,310.29.

Investors cheered news that takeover talks for the telecoms provider Daisy Group are still on, even though the new offer is lower than the last. A consortium led by the chief executive offered 190p a share in August but is now pitching 185p, valuing Daisy, up 6.25p at 161.25p, at just shy of £500m.

The TV gaming company NetPlay fell 1.75p to 8.12p after warning that its high marketing spend meant profits for the year would be below expectations. The group admitted that the spending also failed to deliver the number of new customers it was hoping for.

Magnolia Petroleum climbed 0.07p to 1.15p after announcing that two more wells in the US have begun production and revealing that its production costs are less than $30 per barrel, an unusually low figure that gives it slack to deal with low oil prices.