London Market Open Report

London open: More gains for blue chips

London’s top stocks have pushed on again helped by British Airways sounding slightly more upbeat than in recent weeks and more gains for the miners.

British Airways said it will further cut capacity, parking a total of 22 aircraft during winter 2010, as it swung to a loss in the first quarter. “While traffic volumes are down considerably compared to last year, they have stabilised during the quarter and show some signs of improvement for the peak summer months. However, yields remain volatile,” it said.

Bid-threatened miner Anglo American saw underlying earnings slump by nearly 70% in the first half of 2009 as the impact of the global downturn on demand for commodities took its toll. Pre-tax profits fell to $3.63bn from $6.47bn on revenues of $11.1bn, down 38%, but underlying earnings picture showed a much steeper fall to $1.1bn from $3.48bn.

Real estate firm Liberty said results for the six months to June reflect a continuation of the “very difficult” retail environment and reductions in property values. Pre-tax losses narrowed slightly to Ł452m from Ł458m last year, while group net rental income fell 2% to Ł190m.

Homeserve said the year has started well with continuing policy growth and high renewals rates across its three core membership businesses. The group’s expectations for the full year remain unchanged.

Best performers are two dividend cutters. Bingo group Rank plans to resume dividend payments in the future, once trading conditions and market outlook improve. Underlying pre-tax profits rose to Ł24.7m in the six month ended 30 June compared with Ł17.6m last time, while revenue came to Ł266m from Ł257m previously.

Pest control group Rentokil, meanwhile, posted figures littered with more one-off charges. Investors have chosen to focus on operating profits, which, on actual exchange rates and stripping out one-off charges, rose by 1.5% to Ł69.2m.