Friday 06 June 2008
The FTSE 100 was up 39 points at 6034.3 at 10:46 a.m. on Friday. The leader board was dominated by the mining sector, which recovered on the strength of a rebound in metal prices, and by oil companies, which gained as the price of crude climbed.
British Energy was in focus again – the stock, which was up 7p at 739p, climbed as market sources cited speculation suggesting that EDF's advisers had tied-up the funds for a bid proposal, which the French company will present to the British Energy board next week. The talk bore no clues about the level of the bid, but suggested that EDF had received assurances for around £11bn in funding.
Among oil companies, Cairn Energy proved the strongest on the FTSE 100, gaining 119p to 3,308p and claiming first place on the leader board. Xstrata, at third place, led the miners and rose by 122p to 4084p.
In addition to firmer commodities prices, Xstrata was helped by some positive comment from Merrill Lynch.
"While the market may be experiencing a period of doubt about the miners, we still see value in our top picks, particularly Xstrata, Anglo and Lonmin which are the beneficiaries today of big coal and platinum group metals related earnings upgrades. We feel that the sector is currently trading on macro fear related to a reversal of the short dollar long-commodities trade," the broker said.
It added: "While we must acknowledge this as a risk, all the feedback from our recent global Metals, Mining & Steel conference in Miami confirmed that any speculative overlay is but an overtone on a fundamentally strong demand picture in Asia and increasingly in Russia & the Middle East. Infrastructure spend is a key theme and we consider related metal demand to be much less price elastic than other perhaps more "discretionary" spend such as consumer goods and auto."
Merrill Lynch also gave a boost to Carphone Warehouse, which rose by 4.75p to 241.75p. The broker said that the expected launch of the new iPhone on the 9 June "could be seen as a positive catalyst" and added Carphone to its list most preferred European Telecoms stocks.
"With the 2G [second generation] phone pipeline now cleaned out, the market is clear for a launch. We believe the launch will be announced by Steve Jobs at his keynote speech on June 9 at the Worldwide Developer Conference in the US," Merrill said.
The strength the oil price struck British Airways, which fell 4.82 per cent or 12.25p to 242p and claimed first place on the blue-chip loser board.
Standard Life, at second place, was almost as weak, shedding 4.29 per cent or 11.25p to 251p, after Deutsche Bank downgraded the stock to "sell" from "hold".
"The immediate outlook for the UK life market is weak, already under volume pressure in 2008, and with a deteriorating economy potentially weighed down further by rising inflation. Though well positioned longer term, Standard Life is in our view one of the most exposed to a tougher UK sales environment near term, particularly in view of the sensitivity of its margins to volumes. On the back of this we lower our new business profit forecast for 2009 by 8 per cent," said Deutsche.
- 1 Rarest Beanie Baby bought for just £10 at car boot sale could be sold for £62,500 on eBay
- 2 Katie Hopkins and The Sun editor David Dinsmore reported to police for incitement to racial hatred following migrant boat column
- 3 Parma, Missouri: 80 per cent of town's police quit after first black mayor is elected
- 4 Australian student Tommy Connolly, 23, adopts his pregnant, homeless 17-year-old cousin to give her a chance at 'a better life'
- 5 Google search history can now be downloaded in its entirety, mass embarrassment expected
Rarest Beanie Baby bought for just £10 at car boot sale could be sold for £62,500 on eBay
Katie Hopkins and The Sun editor David Dinsmore reported to police for incitement to racial hatred following migrant boat column
'Jihadi John': Isis executioner Mohammed Emwazi wanted to wage jihad in Somalia until his friends were betrayed and killed by al-Shabaab
Parma, Missouri: 80 per cent of town's police quit after first black mayor is elected
Australian student Tommy Connolly, 23, adopts his pregnant, homeless 17-year-old cousin to give her a chance at 'a better life'
If I’m being racially abused I don’t need a stranger with a saviour complex to rescue me
The only black face in the Ukip manifesto is on the page about overseas aid
Ukip is the only main political party to not address LGBT rights in its manifesto
Food banks: One million Britons will soon be using them, according to Trussell Trust
Religion isn't growing, it is becoming vigorous in its demise, says philosopher AC Grayling
BBC election debate: The one photo that summed up the whole 90-minute leaders debate
iJobs Money & Business
£60000 - £70000 per annum + benefits : Ashdown Group: A highly successful, glo...
£30 - 35k (DOE): Guru Careers: We are seeking a Pricing Analyst with experienc...
£24000 - £26000 per annum + benefits : Ashdown Group: A highly successful, glo...
£21000 - £24000 per annum: Ashdown Group: The Ashdown Group has been engaged b...