UK investors held their nerve despite deadlock in the US debt wrangling and increasingly frenetic warnings of the consequences if a solution is not found by Thursday’s deadline.
FTSE 100 was 7 points higher at 6,494 even as IMF head Christine Lagarde claimed that a US debt default could send the global economy back into recession.
There is still seemingly an air among investors, however, that the politicians will get their heads together even if it is at the last minute of the eleventh hour. As a result, it was company specific news and broker commentary providing the interest.
Platinum specialist Johnson Matthey (LON:JMAT) and Wickes owner Travis Perkins (LON:TPK) topped the index on the back of upgrades.
Bank of America Merrill Lynch was a major instigator as it shifted its view on a number of stocks.
Travis Perkins (LON:TPK) was one of these and the builders’ merchant is now rated a ‘buy’ from ‘underperform’ in a double upgrade that helped the shares climb 4%.
Merrills thinks the builders’ merchant’s second half interim statement should be encouraging and will give the market a clue about the Wickes owner’s strategic direction.
Help-to-buy is helping the group while its strong cash flow means investors could be set for a cash return soon.
Platinum specialist Johnson Matthey (LON:JMAT) jumped 5% after an upgrade to ‘overweight’ from JPMorgan. It expects years of investment in the industrial catalyst market to lead to accelerated growth. The target price for the shares is now 4,000p against 2,960p today.
Banks weren’t as popular. Alongside revelations that some charge as much as Wonga if you go overdrawn, came a meaty downgrade from Merrills, which cited rising PPI claims as a reason to be cautious.
RBS (LON:RBS) was chopped to 'underperform' and the target price reduced to 325p from 345p, while Lloyds (LON:LLOY) was removed from the US broker's Europe One list though remains a 'buy'.
Elsewhere, Michael Page (LON:MPI) tumbled 6% on a profit warning from the white collar recruitment specialist, though there were some solid performances among the small caps.
Oil explorer Oilex (LON:OEX) led the way after it picked up more shale licences in Western Australia. Shares rose 13% to 3.35p.
Paragon Diamonds (LON:PRG) was also in demand after it was awarded a mining licence for the Lemphane Kimberlite in Lesotho, which puts it on the road to production.
A two-stage plan which will see the group mine 540,000 tonnes for the first 24 months followed by 3mln tonnes for an initial open-pit life of a decade. Shares rose 8% to 6.48p.
Chinese software company GEONG International (LON:GNG) admitted it was flummoxed by the recent surge in its share price, which has doubled in a week.
Urals Energy (LON:UEN) shares did have a reason to advance, around 20% in fact, as a premium priced takeover offer added a new twist to the tug-of-war for the company.
An unnamed party, described as a ‘highly credible’ firm with Russian operational experience, intends to buy up to 100% of Urals Energy shares at a price of 12.25p each.