Market Report: Lloyds strengthens after Basel III boost

Lloyds Banking Group was the best-performing FTSE 100 stock last year and it looks like 2013 is shaping up to be pretty decent too. Lloyds jumped to the top of the tree today after analysts at UBS rated it a buy and awarded it a share price target of 60p, up from 50p.

The reason? Well, earlier this week the loosening of the Basel III liquidity rules helped all the banking stocks look more attractive and UBS raised its price targets to reflect "the better growth and profitability picture beginning to emerge".

Angus Campbell, head of market analysis at London Capital Group, said: "The upgrade from UBS will be most welcome to investors. For those seeking to expose themselves to the UK as opposed to Europe, Lloyds could be a good stock to hold and the shares hit their highest level since May 2011 today."

Lloyds finished up 2.51p at 53.37p.

The benchmark index was riding high during afternoon trade and hit its highest point since May 2008 with the banking shares and engineers helping it up. Volumes were at decent levels and the FTSE 100 index advanced 45.02 points to 6098.65.

Engineer Meggitt also enjoyed a rise on the back of an upgrade, 15.5p to 425p. Bank of America Merrill Lynch upgraded it to a buy and raised its share price target to 470p, from 430p. The group announced chief executive Terry Twigger is retiring and will be succeeded in May by finance director Stephen Young.

Analysts have been busy with their shares shopping lists and Nomura and Morgan Stanley like broadcaster ITV. Nomura gave it a 125p share price target and the shares lifted 0.6p to 109.3p.

With optimism filling the markets some traders gossiped about water group United Utilities. The North-west of England-focused group was the subject of takeover speculation last year, with Ontario Teachers' Pension Plan, Abu Dhabi funds and China Investment Corporation mentioned as possible interested parties with more than 900p a share mooted. The shares edged up 12p to 687p.

Vodafone was still in demand after rumours of a deal with its joint venture partner Verizon circulated in the week and the shares registered another gain, ending the day up 3.1p at 165.5p.

Telecoms giant BT was also favoured and Nomura's scribes rate it a buy with a share price target of 280p. The shares ticked up 2p to 247.1p.

Goldman Sachs' aptly named Henry Tarr thinks oil prices won't rocket this year or next so oil services groups will suffer. But luckily for shareholders of Scotland-based John Wood Group, Mr Tarr thinks its "high, free cashflow and growth" and low-risk business model make it an attractive stock. He thinks project delays in the sector will hit some companies.

But for Wood, which runs and maintains oil rigs and other oil platforms, he raises his rating of the stock to buy, from neutral and gives it a share price target of 912p. The shares gushed toward the top of the benchmark index, and ended up 24.5p at 774p.

There wasn't such good news for the share price of insurer Aviva. On Tuesday night, after the stock market closed, it announced the sale of the rest of its stake in Dutch insurer Delta Lloyd for £353m. Aviva bought Delta Lloyd in 1973 but began offloading its interest in 2009. It follows its sell-off of its US business last month and according to analysts at Panmure Gordon the sale reinforces their view that Aviva "is executing its disposal programme at better-than-anticipated prices and at pace".

New chief executive Mark Wilson is hoping to create a more agile insurance group that is not weighed down by overseas interests. Panmure's analysts retained their buy rating and gave it a share price target of 425p but the shares declined 8.2p to 373.7p.

Sainsbury's shares were looking past their sell-by date after it posted only a 0.9 per cent rise in like-for-like sales, which was slightly below market expectations. Most think the sell-off was overdone but the shares ended down 9.8p to 329.2p. Today is Tesco's turn in the spotlight.

Small-cap index contractor Costain won a £48m contract from Network Rail for phase three of the West Coast line power supply upgrade. The shares surged 7.5p to 263.5p.

Blur Group, the online exchange that lets clients commission work from marketing agencies and experts around the world, reported strong project growth and the shares charged up 18.5p to 105p.

Also on AIM, budget African airline group Fastjet updated on passenger numbers and said it has carried almost 30,000 passengers in its first month and also raised just over £1m from an equity drawdown facility. It lost 0.11p to 4.52p.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Content Writer - Global Financial Services

£25000 - £30000 per annum: Recruitment Genius: From modest beginnings the comp...

Recruitment Genius: Web Developer - PHP

£35000 - £40000 per annum: Recruitment Genius: From modest beginnings the comp...

Recruitment Genius: Field Sales Consultant - Financial Services - OTE £65,000

£15000 - £65000 per annum: Recruitment Genius: This is an exciting opportunity...

Recruitment Genius: Loan Underwriter

£18000 - £20000 per annum: Recruitment Genius: This is a fantastic opportunity...

Day In a Page

A nap a day could save your life - and here's why

A nap a day could save your life

A midday nap is 'associated with reduced blood pressure'
If men are so obsessed by sex, why do they clam up when confronted with the grisly realities?

If men are so obsessed by sex...

...why do they clam up when confronted with the grisly realities?
The comedy titans of Avalon on their attempt to save BBC3

Jon Thoday and Richard Allen-Turner

The comedy titans of Avalon on their attempt to save BBC3
The bathing machine is back... but with a difference

Rolling in the deep

The bathing machine is back but with a difference
Part-privatised tests, new age limits, driverless cars: Tories plot motoring revolution

Conservatives plot a motoring revolution

Draft report reveals biggest reform to regulations since driving test introduced in 1935
The Silk Roads that trace civilisation: Long before the West rose to power, Asian pathways were connecting peoples and places

The Silk Roads that trace civilisation

Long before the West rose to power, Asian pathways were connecting peoples and places
House of Lords: Outcry as donors, fixers and MPs caught up in expenses scandal are ennobled

The honours that shame Britain

Outcry as donors, fixers and MPs caught up in expenses scandal are ennobled
When it comes to street harassment, we need to talk about race

'When it comes to street harassment, we need to talk about race'

Why are black men living the stereotypes and why are we letting them get away with it?
International Tap Festival: Forget Fred Astaire and Ginger Rogers - this dancing is improvised, spontaneous and rhythmic

International Tap Festival comes to the UK

Forget Fred Astaire and Ginger Rogers - this dancing is improvised, spontaneous and rhythmic
War with Isis: Is Turkey's buffer zone in Syria a matter of self-defence – or just anti-Kurd?

Turkey's buffer zone in Syria: self-defence – or just anti-Kurd?

Ankara accused of exacerbating racial division by allowing Turkmen minority to cross the border
Doris Lessing: Acclaimed novelist was kept under MI5 observation for 18 years, newly released papers show

'A subversive brothel keeper and Communist'

Acclaimed novelist Doris Lessing was kept under MI5 observation for 18 years, newly released papers show
Big Blue Live: BBC's Springwatch offshoot swaps back gardens for California's Monterey Bay

BBC heads to the Californian coast

The Big Blue Live crew is preparing for the first of three episodes on Sunday night, filming from boats, planes and an aquarium studio
Austin Bidwell: The Victorian fraudster who shook the Bank of England with the most daring forgery the world had known

Victorian fraudster who shook the Bank of England

Conman Austin Bidwell. was a heartless cad who carried out the most daring forgery the world had known
Car hacking scandal: Security designed to stop thieves hot-wiring almost every modern motor has been cracked

Car hacking scandal

Security designed to stop thieves hot-wiring almost every modern motor has been cracked
10 best placemats

Take your seat: 10 best placemats

Protect your table and dine in style with a bold new accessory