Overview: contrary to pre-trade projections, the FTSE 100 was on the rise today and stood 0.7% above the opening level in the last hour of trading.
The UK blue chips were lifted by a positive interim management statement from banking major Barclays (LON:BARC) as well as gains in the mining and energy sectors after oil and metals rose.
Asset manager Schroders (LON:SDR) and gold miner Randgold Resources (LON:RRS) were the top risers in the FTSE 100 with gains of over 5%. Mining majors Xstarta (LON:XTA) and Kazakhmys (LON:KAZ) added just over 3.5%. Peer ENRC (LON:ENRC) tacked on 3.2%, as did Barclays (LON:BARC).
InterContinental Hotels Group (LON:IHG) was the heaviest faller in the FTSE 100 with a 5.2% loss. Oil and gas engineering firm Amec (LON:AMEC) and retailer Morrison Supermarkets (LON:MRW) each shed 1.5%. Engineering company Smiths Group (LON:SMIN) and pharmaceutical company GlaxoSmithKline (LON:GSK) declined 1.3%. Tour operator TUI Travel (LON:TT) was down 1.2%.
US stocks were off to a positive start. The Dow Jones Industrial Average and the S&P 500 index opened with marginal gains. The technology heavy NASDAQ composite rose 0.4%.
Commodities
Crude oil futures were lifted by an upward movement in equity markets today and a weaker US dollar, which put the prices at two year highs.
Gains in oil futures were curbed by projections of another rise in US crude oil stockpiles. Analysts polled by Bloomberg News expected to see a gain of 1.75 million barrels in this week’s reports, which would put inventories at the highest level since May 2009.
US light, sweet crude for December delivery rose to US$87.40/barrel, while January crude reached US$88.03/barrel on the New York Mercantile Exchange (NYMEX).
On the ICE Exchange, December Brent Crude advanced to US$88.78/barrel, while Brent for January delivery last traded at US$88.98/barrel.
BP (LON:BP) led the blue chip oil and gas producers with a 2.8% gain, while fellow supermajor Shell (LON:RDSB) posted a small gain, as did BG Group (LON:BG) and Cairn Energy (LON:CNE).
Tullow Oil (LON:TLW) rose 1.1%.
Amec (LON:AMEC) declined 1.2%. Another oil and gas engineering firm Petrofac (LON:PFC) did better, climbing 1%.
JKX Oil & Gas (LON:JKX) led the midcaps, advancing 4.1%. Soco International (LON:SIA) and Melrose Resources (LON:MRS) followed with gains of 1.3%. Dragon Oil (LON:DGO) and Premier Oil (LON:PMO) stood just above the opening levels.
Heritage Oil (LON:HOIL) and Salamander Energy (LON:SMDR) declined marginally.
Services companies were on the rise. Wood Group (LON:WG) tacked on 1.3% and Wellstream Holdings (LON:WSM) posted a small gain.
EU focused oil and gas explorer and producer Northern Petroleum (LON:NOP) was among the top performing small caps, surging 15%. US focused Caza Oil & Gas (LON:CAZA, TSX:CAZ) and Nighthawk Energy (LON:HAWK) followed with gains of 10%.
Chinese coal bed methane (CBM) gas producer Green Dragon Gas (LON:GDG) also did well, climbing 5%.
Gold reaches new record high
Gold set new record highs today, rising above US$1,400/oz, as investors sought protection amid a new wave of debt worries in Europe and the anticipated inflation of the US dollar.
Gold last traded at US$1,416/oz. Silver and platinum reached US$28.30/oz and US$1,782/oz respectively.
Major mining stocks rallied today with gold producer Randgold Resources (LON:RRS) taking the lead in the sector in the FTSE 100 with a 5% advance. Peer African Barrick Gold (LON:ABG) added 1.6%.
Silver miner Fresnillo (LON:FRES) and platinum producer Lonmin (LON:LMI) climbed 2.8% and 1% respectively.
Gold miner Petropavlovsk (LON:POG) was the top performing midcap, surging 6.5%. Silver producer Hochschild Mining (LON:HOC) and Aquarius Platinum (LON:AQP) tacked on 4.6% and 1.5% respectively.
Fiji operating gold miner Vatukoula Gold Mines (LON:VGM) was among the top risers in the sector with a 13% gain. Philippines operating gold producer Medusa Mining (LON:MML, ASX:MML, TSX:MLL) followed, rising 9%.
South America focused gold miner Mariana Resources (LON:MARL) and Norseman Gold (LON:NGL, ASX:NGX), which operates Australia’s longest continuously running gold mining operation, added more than 6%.
Base metals rise
Copper and nickel rose to US$4.10/lb and US$11.09/lb, while zinc reached US$1.147/lb.
Kazakhmys (LON:KAZ) and Xstrata (LON:XTA) led the sector with gains of 3.5%. Rio Tinto (LON:RIO) rose 3%. Antofagasta (LON:ANTO), Eurasian Natural Resources (LON:ENRC) and Vedanta Resources (LON:VED) added about 2.5%. Anglo American (LON:AAL) and BHP Billiton (LON:BLT) tacked on nearly 2%.
London’s only listed pure iron ore producer and FTSE 250 constituent Ferrexpo (LON:FXPO) also did well, climbing 1.8%.
Gold and uranium explorer Red Rock Resources (LON:RRR) was among the top risers on AIM, soaring more than 40%. Nickel and copper explorer operating in Australia and Papua New Guinea Regency Mines (LON:RGM, Frankfurt: RM4) and Canada focused gold and base metal explorer and developer Landore Resources (LON:LND) rallied 16.5% and 12% respectively.
Rambler Metals & Mining (LON:RMM, TSX-V:RAB), which is focused on the Rambler copper-gold property in Canada, joined the party with a 7% gain.
Banks, insurance, private equity
Barclays (LON:BARC) led the banks, rising 3.2%. HSBC (LON:HSBA) and Lloyds (LON:LLOY) followed with marginal gains.
Standard Chartered (LON:STAN) moved in the opposite direction, shedding 1%.
Royal Bank of Scotland (LON:RBS) held steady.
Aviva (LON:AV) was the top riser in the insurance sector with a 1.2% gain. Old Mutual (LON:OML) stood just above the opening level.
Prudential (LON:PRU) and RSA Insurance Group (LON:RSA) lost 1.6% and 1.2% respectively.
Admiral Group (LON:ADM) and Legal & General Group (LON:LGEN) declined marginally.
Private equity firm 3i (LON:III) declined 1.6%.
Small Cap Movers
Other notable movers among the small caps included IP commercialisation company Amphion Innovations (LON:AMP) and coloured gemstone company with a focus on Zambian emeralds Gemfields (LON:GEM), which rose 9% and 6% respectively.
Small Cap News
Planet Payment (LON:PPT and PPTR; OTC:PLPM) kept up its strong momentum in the third quarter, with a 32 percent rise in year-on-year revenue.
Stratex International PLC (LON:STI) said it is making good progress at its Inlice and Altıntepe gold projects in Turkey, which are being advanced with its joint venture partner NTF Insaat Ticaret Ltd Sti, with a target of first gold production by Q1 2012.
Desire Petroleum (LON:DES) has secured both regulatory and partner approvals to drill the 14/15-2 Rachel North well to evaluate sands with oil shows encountered in a previous well.
African Medical Investments (LON:AMEI) is attempting to cancel 24 million shares that are held on behalf of former chief executive Dr Vivek Solanki. The company has bounced back strongly since Solanki left the company back in July amid investigations of a suspected fraud.
The proposed £37 million takeover of Chromex Mining (LON:CHX) looks set to go ahead after more than 80 percent of shareholders have accepted the bid from Synergy Africa.
Minera IRL (LON:MIRL, TSX:IRL, BVL:MIRL) said that agents who participated in an equity offering announced in October are exercising the full over-allotment option.
Both brokers and investors are responding positively to the most recent drilling report from Baobab Resources (LON:BAO), which is developing the Tete iron-vanadium-titanium project in Mozambique.
Bowleven (LON:BLVN) shares soared after the group announced it made two potentially significant hydrocarbon discoveries in Cameroon. Shares spiked over 27 percent in early trading, reaching an intra-day high at 253.25p before settling down. Bowleven was last trading near 240p, up 20 percent at around 11:00am on London's AIM market.
Westhouse was encouraged by yesterday’s news from Petro Matad (LON:MATD) which secured a winterised rig to overcome the severe conditions of the Mongolian winter and drill an extra well this year.
Electrum Resources (LON:ECR, OTC:MTGDY) expects the value of its stake in THEMAC to grow substantially in the future, now that THEMAC agreed a fundraising to take full control of the Copper Flat copper-molybdenum-gold-silver project.
Focus Solutions (LON:FSG) shares shot up around 30 percent after it confirmed that it is currently in preliminary discussions over a potential sale of the company.
Chaarat Gold (LON:CGH) has secured a £2.6 million investment from a Malaysian mining technician, the ASVI Group. ASVI stepped in to take up the subscription shares that were originally destined for Chaarat’s planned Chinese investment partner China Nonferrous Metals International Mining (CNMIM).
The market is applying excessive risk to IGas Energy’s (LON:IGAS) coal bed methane assets, according to research by Goldman Sachs. In a note to clients Goldman said that IGas offers attractive exposure to unconventional gas assets in the UK.
Red Rock Resources (LON:RRR) shares rocketed in afternoon trade after the group announced plans to fast-track a second gold mine in Colombia, and highlighted a substantial resource upgrade at Jupiter’s newly acquired Tshipi manganese project in South Africa.