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Wall Street up after three-day losing streak but Fed concerns remain

Last updated: 01:11 14 Dec 2013 AEDT, First published: 02:11 14 Dec 2013 AEDT

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Shares opened slightly higher in Wall Street after a three-day fall,but investors remain anxious ahead of the Fed’s policy meeting next week on expectations the central bank will soon start easing its asset-purchase programme.

The Dow Jones Industrial Average (DJIA) was up 0.17% to 15,765, the S&P 500 gained 4.28 points at 1,779 and tech-laden Nasdaq added 18 points to 4,016.

The newsflow was pretty thin on the ground but among the rare stocks hitting the headlines this Friday on the other side of the Atlantic was Anadarko Petroleum Corporation, which has been embroiled in a trial since last year.

A judge ruled the company and its Kerr-McGee unit acted with "intent to hinder" when they spun off paint materials company Tronox, that later went bankrupt.

The companies may be liable for up to US$14bln in settlement payments.

Shares fell over 10% soon after the opening bell rang.

Meanwhile mobile technology firm Qualcomm has named its Chief Operating Officer Steve Mollenkopf as its new CEO.

From March next year he will be replacing Paul Jacobs, who will become executive chairman.

Back in the UK, RSA Insurance’s (LON:RSA) shares remained under considerable pressure after the CEO announced his resignation following problems at the group’s Irish business.

Simon Lee has resigned with immediate effect from his role after a review showed its Irish unit needs to be strengthened by an extra £130mln, on top of the £70mln announced in November relating to claims and finance issues in the country.

This, along with last week’s storms across Europe, will impact earnings further for 2013, the company said, in the third warning of this year. It now expects mid-single digit return on equity this year.

RSA also hinted it could cut its dividend further in February.

A full review of the business  is now underway to improve the capital strength of the group, whose shares Shares fell over 12% to 87p.

RSA’s dire performance was offset by strong gains in ARM Holdings (LON:ARM) shares after it bought ANGLE plc’s (LON:AGL) computer games graphics business Geomerics from the group for £6.2mln.

This marks ARM's first foray into computer games, having been focused on designing chips to power computers, tablets and smartphones, including Apple's iPads and iPhones. 

It is hoping to benefit from the recent shift in gaming, which is moving from traditional consoles to tablets and smartphones.

Investors certainly welcomed the move, with shares adding over 4% to 1,009p.

ANGLE was little changed, however, after announcing the deal – shares remained at the 79.5p level.

In news that vindicate the government’s action to boost home building across the country, Bellway (LON:BWY) said almost a third of its new reservations since August involved the government’s Help-to-Buy scheme.

Demand for houses has been very strong Bellway said, with reservations since August rising by 43% on a year ago to an average of 144 per week. The government’s Help-to-Buy scheme contributed 31% of that rise. 

Sales are also soaring with 20% more completions than last year expected in the six months to January, while the average selling price is up to £205,000 with operating margins now expected to exceed 15% in the full year to July, it said.

Despite fears the government’s scheme could spur a house price bubble, shares in Bellway rose 1.5% to 1,436p.

Among small caps, Regency Mines (LON:RGM) rose 5% to 0.481p - following upbeat broker comments.

Beaufort says Regency offers exposure to a unique nickel processing story, which could transform the shares.

Direct Nickel Limited (DNi), in which Regency has a 7.5% stake, and which it is joint ventured with on the Mambare nickel-cobalt project in Papua New Guinea, is close to completing a validation report on the nickel laterite treatment process at its test plant in Australia.

The broker notes a positive outcome could spark interest from major industry  players - seeking both to participate in the immediate opportunity and Regency's rights to additional licensing and ultimately lead to a revaluation of world class prospects. 

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