Date: Thursday 10 Jun 2010
Footsie closed up handily after a decent start on Wall Street on a day dominated again by the problems besetting oil giant BP.On the economic front the Bank of England’s Monetary Policy Committee, as expected, left its interest rate and quantitative easing policies unchanged. The European Central Bank also left rates unchanged.
Wednesday’s plunge in the value of its US stock shocked BP into issuing a statement this morning claiming it knew no reason for the dramatic sell-off. BP shares slumped 16% in heavy US trade as rumours did the rounds that the Gulf of Mexico oil disaster could force the business into bankruptcy, or at the very least cause it to axe the dividend. The cost of the spill has now reached $1.43bn (Ł982m).
UK prime minster David Cameron was today dragged into the Gulf of Mexico controversy. Speaking from Afghanistan, he said, "I've got a series of meetings and telephone calls and other contacts with the President coming up and I'm sure that BP and what's happened off the Gulf coast will be something we will discuss."
British chip maker ARM Holdings was a strong performer on the revival of the old rumours of a bid from US consumer electronics giant Apple. Its FTSE 250-listed peer Imagination Technologies, whose chips are also used in smartphones, jumped too.
Miners were also strong with ENRC and Xstrata among the large cap high-flyers in the sector.
Home Retail is another blue-chip got a battering in an otherwise moderately buoyant market. The retailer complained of shoppers’ reluctance to part with their cash in uncertain economic times as it reported a decline in like-for-like sales at both its Argos and Homebase stores in the 13 weeks to 29 May.
Fellow retailer Halfords had a better time of it. The car parts and bicycle retailer said it is confident of future earnings growth despite the uncertain economic outlook after posting a sharp rise in profits and revenues in the year to April 2. Pre-tax profits climbed to Ł117.1m from Ł92.4m on revenues that were up to Ł831.6m from Ł794.7m.
Electronic and industrial components supplier Premier Farnell issued a confident outlook for 2010 as quarterly profit more than doubled. Total profit before taxation rose to Ł22.2m in the three months to the end of April 2011 from Ł9m the year before. Revenue advanced 20% to Ł244.9m.
Soap maker PZ Cussons’ results for the year ended 31 May 2010 are expected to be in line with expectations despite deteriorating trading conditions in the UK. The UK trading environment remains competitive with a worsening consumer outlook, the group said but on a brighter note saw strong growth in its brands such as Imperial Leather, Carex, Original Source, Charles Worthington and The Sanctuary.
Britain’s biggest coal miner UK Coal and energy sector support services group Hargreaves Services no longer intend to merge, the companies announced this morning. Hargreaves said that ‘while recognising that UK Coal has many valuable assets, it does not intend to pursue such a merger.’
Chapelthorpe showed profits for the first time in six years, triggering the polypropylene fibre manufacturer to recommence dividend payments in current financial year. Lower cost of sales and operating expenses helped the group post profits of Ł709,000 against the Ł3.3m loss last year
Avocet Mining rebuffed press speculation that it has sold its South East Asian mines and that the company itself was on the verge of being sold. The mining firm said these reports are “incorrect and without foundation.”
Shares in components firm Elektron rose 2.5% after it reported a surge in orders for the year to date and said it is well positioned for future growth.
Sarantel, which makes high-performance antennas for mobile phones and other wireless gadgets, has won orders to supply antennas for Inmarsat’s satellite phone the IsatPhone Pro.Customer information software group Portrait Software has agreed a Ł44.4m cash bid from US giant Pitney Bowes. The offer is 31p per share.
Asbestos removal specialist Silverdell swung recovered strongly in the half-year to March, with profits of Ł569,000 against losses of Ł6.7m. “We remain positive about the group's outlook, although the overall economy will continue to be challenging. The order book is strong at Ł60m with Ł20m booked for the second half of 2010”.
FTSE 100 - Risers
ARM Holdings (ARM) 290.10p +5.88%
Burberry Group (BRBY) 784.00p +4.95%
Autonomy Corporation (AU.) 1,915.00p +4.82%
Lloyds Banking Group (LLOY) 55.91p +4.56%
FTSE 100 - Fallers
BP (BP.) 365.50p -6.65%
Home Retail Group (HOME) 228.30p -4.08%
Royal Dutch Shell 'B' (RDSB) 1,684.00p -1.12%
Morrison (Wm) Supermarkets (MRW) 264.70p -0.75%
FTSE 250 - Risers
Imagination Technologies (IMG) 272.00p +13.81%
Premier Farnell (PFL) 244.00p +11.11%
SDL International (SDL) 474.30p +7.50%
Ashtead Group (AHT) 112.70p +6.42%
FTSE 250 - Fallers
Unite Group (UTG) 163.00p -6.05%
Game Group (GMG) 85.65p -4.89%
Gartmore Group (GRT) 104.80p -3.59%
IG Group Holdings (IGG) 422.30p -2.20%
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