Overview: the FTSE 100 is expected to continue its winning streak today once again starting the day against a positive backdrop after yet another strong session on Wall Street where the Dow Jones industrial average added over 1%, while Hong Kong’s Hang Seng stood almost 2% higher by midday. Japan’s Nikkei average also rose yesterday after the commodity sector rose on higher oil and metals prices.
The UK’s blue chips are also expected to benefit from stronger commodities. Oil continued climbing as West Texas Intermediate (WTI) moved up to US$72.5/barrel and Brent Crude reached US$70.6. Precious metals also were on the rise. Gold was at US$1,023/oz, Silver improved to US$17.6/oz and Platinum was at US$1,345/oz. Base metals miners will also benefit from higher prices as Copper reached US$2.91/pound, Nickel was at US$7.96/pound, while Zinc reached US$0.86.
The oil and gas sector is expected to be buoyed by London-based explorer Tullow Oil (LSE: TLW), which announced yet another discovery in Africa today.
Morning news wrap
Tullow, which made it to the top of the leaderboard yesterday with a 10% gain on speculation about a possible takeover by Italian energy giant Eni and reports of a major discovery in offshore Sierra Leone, which were later confirmed, released another update this morning, announcing yet another discovery, this time in Uganda. The company said the Ngassa-2 exploration well in the Kaiso-Tonya region encountered seven metres of oil pay in a 14 metre gross sand. The Ngassa oilfield has the potential to become the largest oil field in the basin to date, Tullow said in the statement.
Owner of the B&Q chain retail group Kingfisher (LSE: KGF) released its interim results today, reporting a 7.3% increase in sales to £5.5 billion, while adjusted pre-tax profit hiked 34.6% to £288 million, which in line with the group’s expectations.
Engineering and construction group Balfour Beatty (LSE: BALF) today confirmed it was in “advanced discussions” regarding a “significant and complimentary acquisition,” which would “materially accelerate the fulfilment of its strategy.” The media reported earlier this week that Balfour was planning a £350 million cash call to fund an acquisition.
In the FTSE 250, Emerald Energy (LSE: EEN) released an update on its Colombian operations today, saying its gross oil production averaged 4,196 barrels per day (bpd) in August, while the Capella oil field contributed 243 bpd.
Building and civil engineering contractor Kier Group (LSE: KIE) presented its preliminary results in the morning, saying group revenue slid to £2.1 billion from £2.3 billion last year, while gross profit amounted to £186.8 million compared to £210 million last year.
In the AIM, electrical products manufacturer and supplier Cinpart (AIM: CINP) also released its interims this morning, reporting a decline in revenues to £0.8 million from £1.1 million in H1 2008, while pre-tax losses increased more than threefold to £0.7 million from last year’s £0.2 million.
London listed Australian gold producer Leyshon Resources (AIM: LRL) said trading of its shares has been temporarily suspended today pending an announcement regarding the proposed disposal of Leyshon’s interest in Zheng Guang gold zinc project.