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London stocks mark 5th successive session of gains as financials rise

London’s blue-chip ticker ended Wednesday higher for a fifth successive session after financial stocks put weaker energy stocks in their place

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Pru lifts London stocks

London’s blue-chip ticker ended Wednesday higher for a fifth successive session after financial stocks put weaker energy stocks in their place.

The FTSE 100 index closed up 0.2% at 6866 – a fresh 14-month high.

The UK insurance sector was the powerhouse for the bourse, with Prudential (LON:PRU) closing up 2.3% at 1,424.30p after reporting operating profits rose by a larger-than-expected 9% to £2.06bn boosted by rapid growth in Asia. It said it was well placed to deliver both growth and cash.

But the buoyant interim earnings were tarnished by the company’s suggestion it is mulling moving its funds from London to either Dublin or Luxembourg, according to a Reuters report. The move would be part of the insurer’s efforts to maintain access to the European Union's single market after Britain's vote to leave the trading bloc.

But wherever the Pru manages its funds from, it is evident that the insurer’s business growth is now focused on Asia.

Other insurers were lifted too, such as Legal & General (LON:LGEN) up 3.2% to 212.54p, and Admiral (LON:ADM) up 0.2% to 2,246.41p.

But the oil sector nursed losses after Brent Crude dropped by 1.7% to $44.20 after an unseasonal growth in crude stockpiles offset the second-biggest weekly draw in US gasoline this summer.

Data showing Saudi Arabia pumping oil at record high volumes in July added to worries about a global crude glut.

US crude inventories gained 1.1 million barrels in the week ended Aug. 5, the US Energy Information Administration (EIA) reported, in a third straight week of builds that surprised the market. Analysts polled by Reuters had expected a 1.0 million-barrel crude draw instead.

BP (LON:BP) shares were down 0.4% to 423.65p while Royal Dutch Shell (LON:RDSB) lost 1.1% to 1,973.31p.

The mid-cap FTSE 250 index edged 0.07% higher to 17,699 on Wednesday.

Among its risers, shares in security firm G4S (LON:GFS) jumped as much as 16.16% after it reported a near-10% increase in half-year pre-tax profits to £203m. The stock closed up 6.8% at 208.88p.

Revenues at G4S rose 3.2% to £3.5bn, and the company said it had won £1.4bn of new contracts. Investors were also relieved that G4S maintained its dividend, as there had been speculation it would be cut.

Shares in the company behind the Peppa Pig children's TV character, Entertainment One (LON:ETO), closed up 9% at 237p after it said it had rejected a 236p-a-share takeover offer from ITV plc (LON:ITV). The broadcast network ended up 0.6% at 199.83p.

But the smallest stocks struggled on Wednesday. The FTSE AIM 100 Index ended down 0.3% at 3,725 while the FTSE AIM All-Share Index was flat at 776.

A total of 33% of London shares gained, 29% fell and 38% were unchanged.

London’s top gainer was Xcite Energy (LON:XEL) up 37.7% at 11.5p while the top faller was Nyota Minerals (LON:NYO) down 22.7% to 0.0425p. Neither of the stocks had fresh news.


Midsession

London’s blue chips marked time with the holiday season in full swing and trading levels subdued.

A flat start was also predicted for Wall Street with no major economic news expected today.

FTSE 100 shed seven points to 6,844 with falls evenly spread across the board.

Best of the bunch was aero engine group Rolls-Royce Holding PLC (LON:RR.) as US broker Morgan Stanley upgraded to ‘equal weight’ from ‘underweight’.

RR’s cash position has improved said the broker, which was sufficient for its price target to rise to 780p from 655p.

Randgold Resources (LON:RR.)  was also going well on the back of a jump in the gold price on news that the Bank of England’s bond-buying plans had flopped and the UK had joined the growing club of countries with negative bond yields.

Randgold rose 180p to 8,675p while the gold price spiked US$13 per oz.

Troubled security firm G4S PLC (LON:GFS) led the FTSE 250 as its half-yearly report sent the shares 15% higher to 224p.

Results also helped another perennial laggard, support services Interserve PLC (LON:IRV), jump 17% higher to 374p.

Peppa Pig owner Entertainment One Ltd (LON:ETO) was in demand  as it confirmed a bid approach from ITV. Reports suggest that the film producer has rejected ITV’s offer.

Shares rose 10% to 238p or higher than the mooted 236p approach.

In the small cap space, dual-listed Harvest Minerals Ltd (LON:HMI, ASX:HMI) soared 30% to 8.15p on good numbers from a scoping study at its Maximus  fertiliser project.

Another junior miner, Ironridge Resources (LON:IRR), jumped 17% to 15.8p on plans to buy a stake in a company with gold interests in Chad.

Sales are soaring at Midatech Pharma Plc (LON:MTPH), the oncology and immunology specialist. Shares rose to 134p from 113.5p overnight. Sales have risen ten-fold it said.

On the downside, Arcontech Group PLC (LON:ARC) dipped 6% to  0.38p after it said that it was taking longer to win new business than it would like.

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