LONDON Pre-Market Report (10th December 2009)

London open City sources predict FTSE 100 will open up 3 points from previous close of 5,204. Stocks to Watch Tim Weller, chief financial officer (CFO) of United Utilities, is to jump ship to take over the CFO role at the Cable & Wireless division, Cable & Wireless Worldwide. Weller will join the Cable & Wireless Worldwide board of directors in May 2010. Higher sales from its shops helped sports retailer Sports Direct shrug of a decline in its wholesale business to post a rise in sales and underlying pre-tax profits. In the half year to October 25, revenues climbed to Ł756.9m from Ł687.7m over the same period the previous year. Underlying pre-tax profits climbed to Ł71.9m from Ł51.8m. Electronic components distributor Premier Farnell reported a 37% fall in third quarter profits but said the period has seen further improvement as the rate of year on year sales decline in its business continued to ease. In the Press Citigroup is in advanced talks with regulators over plans to raise more than $15bn in an equity offering, in an effort to repay $20bn in bail-out funds as early as Thursday. People close to the situation said that Citi was also planning to raise around $2bn of mandatory convertible securities – a new form of security that converts into equity when a bank’s capital ratio falls below a predetermined level, says the FT. HSBC is closing in on acquiring the remaining Asian retail and commercial assets being divested by RBS. People familiar with the matter said that the sides had struck a deal for the assets in China, India and Malaysia but that it was subject to regulatory approval in the three countries, writes the FT. Royal Bank of Scotland has sent out sales documents for RBS Sempra Commodities, its American joint venture, and hopes to sell the energy trading business within the next few months, reports the Times. About 20,000 bankers are expected to be snared by the Government’s super-tax on bank bonuses announced in the pre-Budget report, the Telegraph has learned. Newspaper Tips Stagecoach, the bus and rail operator, proclaimed itself pleased with yesterday's half-year results: pre-tax profits were Ł75.5m, versus Ł105.2m this time last year, while earnings per share dropped to 9p, from 12.1p in 2008. The wheels could certainly come off, but on balance, we're happy to hop on Stagecoach at this stop. Buy, says the Independent. It will not be until full-year results in March that shareholders in Standard Chartered get a clearer picture of its exposure to Dubai. But Ł14.62, or 12 times 2010 earnings, remains reasonable value for double-digit profit growth. Hold, writes the Times. The broader trend that underpins Imagination’s growth — the rise in chip-intensive smart phones from 10 per cent of mobile sales to an estimated 40 per cent within three years — is intact. Next year’s US launch of Pure should provide a further fillip. At 224p, or 22 times next year’s earnings, buy on weakness, according to the Times. US close US blue chips made progress despite worries about European economies following S&P’s downgraded credit rating for Spain. Economic data helped ease the global concerns. US total wholesale inventories rose 0.3% in October, according to data from the Commerce Department, reversing a 12-month declining trend. Analysts were expecting inventories to fall 0.5%. There was also a decline in crude oil inventories, which suggests a possible upturn in demand. The US Treasury is preparing to sell $34bn of bonds in the next couple of days. Yesterday’s $40bn issue of three-year notes was at the lowest yield since January. Treasury Secretary Tim Geithner said the Troubled Asset Relief Programme (TARP) will be extended beyond its current expiration date of 31 December 2009 to October of next year. Post-it notes maker 3M was the biggest riser in the Dow after being upgraded to ‘buy’ from ‘hold’ by Citigroup. Citigroup made the same recommendation upgrade for mobile carrier Sprint Nextel making its the best performer in the S&P 500. Drugs developer Pfizer made a healthy gain after entering into a collaborative agreement with Crown Bioscience to research and develop novel therapeutics for Asian cancers.

Sector Risers

Name	Value	% Change
Technology Hardware & Equipment	337.86	+0.7%
Mining	20,310.83	+0.5%
Tobacco	23,690.85	+0.4%
Banks	4,695.76	+0.2%
Gas, Water & Multiutilities	3,922.90	+0.0%

Sector Fallers

Name	Value	% Change
Forestry & Paper	3,461.91	-4.1%
Industrial Metals	4,690.43	-3.3%
Life Insurance	3,683.79	-2.3%
Food & Drug Retailers	4,673.01	-2.1%
Construction & Materials	3,119.78	-1.9%