Market Report: Tullow's latest gas hopes evaporate

Tullow Oil's foray into Kenya has had yet another hiccup. Perhaps it was the gas. On Monday the explorer revealed it had found gas but no oil at a well off the Kenyan coast. Then yesterday afternoon it revealed that, disappointingly, gas was not found lower down in the Mbawa-1 well. Said well will now be plugged and abandoned.

In May Tullow was left red faced when it was forced to issue a statement on progress at its Ngamia-1 well, onshore in Kenya, after it accidentally let slip confidential information to investors.

The Mbawa-1 well was the first offshore Kenyan gas discovery, and at least it was described as "encouraging". Tullow said that although it was unsuccessful the results would be "vital in evaluating the still significant prospectivity of this block".

Tullow is working on the well with the US-based operator Apache and its Australian partners, Origin Energy and Pancontinental.

After losing 18p on Monday, Tullow fell another 29p yesterday to 1,357p.

Punters donned their tin hats and turned defensive yesterday, leaving the blue chip FTSE 100 down 1.01 points at 5792.19. Safe-haven stocks were in favour, with British American Tobacco up 57.5p to 3,182p, as a cautious feeling swept the City ahead of a German court's ruling on its participation in the planned European bailout today.

Meanwhile, riskier stocks – including most of the mining sector – dived towards the bottom of the benchmark FTSE 100 index with Fresnillo down 49p to 1,707p and Vedanta Resources and Anglo American also tumbling.

Vedanta was also hit by revelations of a scam in India which pushed Goa to impose a temporary ban on mining. The southern state is the country's second-biggest iron ore producer and both Vedanta and its Indian arm, Sesa Goa – which is merging with Sterlite Industries –have been affected by the ban. Vedanta lost 24.5p to 978.5p but experts do not expect Goa's move to have a long-term impact on the miner.

Anglo American, down 46.5p at 1,955p, meanwhile received a downgrade. Analysts at JPMorgan said Anglo's valuation still did not "adequately reflect the various risks the company faces" and they cut their price target to 1,750p from 1,900p.

Over on the FTSE 250 the South African platinum miner Lonmin lost 8p to 611p as its workers strike continued to rumble on. Fears are mounting that unrest will continue to spread across South Africa's mining sector.

Royal Bank of Scotland topped the leaderboard, up 11.7p to 264.7p. Scribes at JP Morgan said they would retain their neutral stance on the shares but added that at current levels there was "better value in RBS than Lloyds".

The software giant Sage edged up 1.4p to 305.8p. On Monday analysts at Galvan Research issued a buy rating following renewed M&A rumours. Andrew Gibson at Galvan said there was "the distinct possibility that Sage could be a target of German sector peer SAP". Some traders speculated that private equity players might also take a look.

The handbags and gladrags at Burberry haven't tempted enough shoppers to part with their cash. The luxury fashion group found itself at the bottom of the FTSE 100, down more than 20 per cent, losing 287p to 1,088p, after a profits warning. The fall prompted some traders to start bottom-fishing and buy the shares.

The revelation of slowing sales growth also tarnished luxury peers in Europe. French giant LVMH, the parent of Louis Vuitton, lost 3.36 per cent and the Gucci owner PPR Group was down more than 2 per cent.

Today's FTSE 100 quarterly reshuffle is likely to see the broker Icap leaving and the energy services company John Wood Group will rejoin after a year's break. The final sign-off of who joins and who leaves will be confirmed at the end of trading today.

Among the small caps Anglesey Mining shot up 1p to 9p. It was revealed that its chief executive, Bill Hooley, demonstrated his confidence by buying 100,000 shares in the company. He now holds 200,000 shares.

PROMOTED VIDEO
News
Rumer was diagnosed with bipolarity, attention deficit hyperactivity disorder and post-traumatic stress disorder: 'I was convinced it was a misdiagnosis'
peopleHer debut album caused her post-traumatic stress - how will she cope as she releases her third record?
Arts and Entertainment
'New Tricks' star Dennis Waterman is departing from the show after he completes filming on two more episodes
tvOnly remaining original cast-member to leave long-running series
Life and Style
Couples have been having sex less in 2014, according to a new survey
life
Voices
Holly's review of Peterborough's Pizza Express quickly went viral on social media
voices
Arts and Entertainment
musicBiographer Hunter Davies has collected nearly a hundred original manuscripts
Sport
A long jumper competes in the 80-to-84-year-old age division at the 2007 World Masters Championships
athletics
News
ebooksAn unforgettable anthology of contemporary reportage
Life and Style
Walking tall: unlike some, Donatella Versace showed a strong and vibrant collection
fashionAlexander Fury on the staid Italian clothing industry
Arts and Entertainment
Gregory Porter learnt about his father’s voice at his funeral
music
Arts and Entertainment
tvHighs and lows of the cast's careers since 2004
Life and Style
Children at the Leytonstone branch of the Homeless Children's Aid and Adoption Society tuck into their harvest festival gifts, in October 1936
food + drinkThe harvest festival is back, but forget cans of tuna and packets of instant mash
Sport
Lewis Hamilton will start the Singapore Grand Prix from pole, with Nico Rosberg second and Daniel Ricciardo third
F1... for floodlit Singapore Grand Prix
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

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Day In a Page

Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam