Market update - 27 April
Monday 27 April 2009
The FTSE 100 was 35.44 points behind at 4120.55 while the FTSE 250 fell to 7239.66, down 130.09 points, at around 11.05am.
Travel and tourism stocks were thrown off course as traders began to fret about the impact of the swine flu outbreak, which has claimed numerous lives in Mexico, and raised fears of a potential pandemic. Carnival, the cruise operator behind P&O Cruises and the Cunard Line, was the hardest hit, retreating to 1799p, down 7.2 per cent or 140p, while British Airways eased to 151.8p, down 7.4 per cent or 12.1p.
Swine flu fears, although negative for the travel-related stocks, boosted the blue-chip pharmaceutical issues, with GlaxoSmithKline, up 3.4 per cent or 34.5p at 1040p, climbing to first place on the benchmark index. AstraZeneca, up 2.8 per cent or 66p at 2460p, was at third place, while Shire was 1.7 per cent or 165p ahead at 890p.
Elsewhere, Aviva advanced to 282p, up 3.2 per cent or 8.75p, after saying that its capital cushion had swelled to £2.5bn, while first quarter sales had climbed by a better-that-forecast rate of 11 per cent.
The news was welcomed by analysts and investors alike, with Deutsche Bank, which was amongst the first to question the strength of capital buffers in the life insurance sector, saying that Aviva had “shot the lights out this morning”.
“To some respect, this looks to have been anticipated by a 15 per cent move up in the shares on Friday, but nonetheless, the solvency strength is way ahead of expectations. Most important is the first quarter solvency figure of £2.5bn, some £600m above our own estimate (which in turn was above consensus),” Deutsche analyst Nicholas Byrne said,
“The positive surprise here looks genuine – relative to our own forecasts, the difference is £200m of dividend taken in the form of scrip (though obviously this is effectively the issue of new shares), £100m from the sale of Delta Lloyd Health (actually sold 18 months ago, but only completed in January 2009) and £200m from a further stop-loss reinsurance deal between the UK life division and Swiss Re.”
The private equity group 3i was 7.3 per cent or 27p behind at 344.75p after the company said that it was considering a range of financing options, including a possible equity issue. The admission follows recent reports of a possible £500-£700m fundraising as the company attempts to reduce its debts.
- 3 Alton Towers crash: Four seriously injured and 16 guests trapped as Smiler ride carriages collide
- 4 Ann Summers survey reveals the UK's favourite sex position
Man on naked bike ride gets ejected after becoming aroused
Caitlyn Jenner's mother Ester thought her daughter, formerly known as Bruce Jenner, had transitioned for money
Charles Kennedy 1959-2015: A gifted, compassionate politician whose career was cut short by the 'demon drink' - latest news
Alton Towers crash: Four seriously injured and 16 guests trapped as Smiler ride carriages collide
Charles Kennedy dead: A guy once asked the Lib Dem leader who his favourite Muppet was and his letter response was wonderful
Thousands of teenage girls enduring debilitating illnesses after routine school cancer vaccination
Migrants in Kos: Photos show real tragedy after Brits abroad complain of 'awkward' holidays
British tourists complain that impoverished boat migrants are making holidays 'awkward' in Kos
Michael Gove determined to scrap the Human Rights Act – even if Scotland retains it
Threat to scrap Human Rights Act could see UK follow Nazi example, warns UN official
Church of England 'one generation away from extinction' after dramatic loss of followers
iJobs Money & Business
£30000 - £35000 per annum: Recruitment Genius: The UK's fastest growing, multi...
£70000 - £90000 per annum: Recruitment Genius: A Financial Reporting Manager i...
£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...
£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...