Overview: the FTSE 100 expectedly fell in the morning, but its losses were limited to just about 10 points, or roughly 0.15% after the blue chips got a boost from plumbing and heating materials manufacturer Wolseley (LSE: WOS), which rallied 10% after releasing its final results. Helping out were pharmaceutical company AstraZeneca (LSE: AZN) and commercial property company Hammerson (LSE: HMSO), which both added more than 2%.
No other FTSE 100 constituent managed to tack on 2% or more in early trade. Asset management company Schroders (LSE: SDRC), consumer goods company Reckitt Benckiser (LSE: RB) and private equity group 3i (LSE: III) came close, adding about 1.5%.
British American Tobacco (LSE: BATS) and another property company British Land (LSE: BLND) were both up 1.3%.
Home Retail Group (LSE: HOME) again emerged as the leading faller, shedding 3.3%. Miners were the heaviest fallers with a number of blue chip base metals producers including Rio Tinto (LSE: RIO), ERNC (LSE: ENRC), Anglo American (LSE: AAL) and Kazakhmys (LSE: KAZ) losing more than 2%.
Banks Lloyds (LSE: LLOY) and RBS (LSE: RBS) both shed 2.8%.
US futures were mixed in the morning following the G20's futile effort to come up with proposals for banking system reforms.
Commodities
Commodity focused stocks expectedly inched lower, responding to further decreases in oil and metals prices.
Oil failed to recover from the losses it suffered late last week. West Texas Intermediate in the US held steady at US%65.9/barrel, while Brent Crude spot prices slid to US$64.3/barrel.
In the FTSE 100, Tullow Oil (LSE: TLW) and Cairn Energy (LSE: CNE) led the fallers with declines of 2.7% and 1.8% respectively. BG Group (LSE: BG) slid 0.5% to 1,079 pence per share.
Supermajors BP (LSE: BP) and Shell (LSE: RDSB) were little moved, staying around the opening levels. Petrofac (LSE: PFC) managed to hold on, posting marginal gains in early trade.
Mid caps performed slightly better. Heritage Oil (LSE: HOIL) declined marginally, while Dragon Oil (LSE: DGO) managed to outperform the sector with a gain of about 1.7%. Another FTSE 250 constituent Dana Petroleum (LSE: DNX) shed 2.6%.
Iraq operating Irish oil company Petrel Resources (AIM: PET) shed 15% after releasing its interim results, emerging as one of the leading faller sin the sector. Western Europe operating oil and gas company Northern Petroleum (AIM: NOP) also was in selling mode, moving down almost 7%. Ukraine focused gas producer, Regal Petroleum (AIM: RPT) and Latin American focused Gold Oil (AIM: GOO) followed, sliding about 3.5%.
Kazakhstan operating Max Petroleum (AIM: MXP) declined 2.5%.
Gold and silver recover, but miners keep falling
Precious metals slightly improved after falling late last week. Gold slightly improved from Friday’s levels, rising to US$991/oz. Silver stopped just 2 cents short of US$16/oz, while Platinum improved to US$1,275/oz.
Major mining stocks also opened with losses.
Platinum producer Lonmin (LSE: LMI) was the leading faller among the blue chip miners, losing about 1.7%, while silver miner Fresnillo (LSE: FRES) and gold producer Randgold Resources (LSE: RRS) declined marginally.
Specialty chemicals firm Johnson Matthey (LSE: JMAT) outperformed the sector with a marginal gain. Yamana Gold (LSE: YAU) lost 2.4%.
Mid caps were weaker in early trade. In the FTSE 250, gold miner Petropavlovsk (LSE: POG), formerly known as Peter Hambro Mining, slid 2.4%, as did silver miner Hochschild Resources (LSE: HOC), while Aquarius Platinum (LSE: AQP) slumped 3.6%.
Kryso Resources (AIM: KYS) was the top performer in the sector after reporting impressive results from drilling at its Pakrut project in Tajikistan with multiple high-grade intersections. The company rallied almost 20% on the update.
South Africa and Botswana operating diamond miner Firestone Diamonds (AIM: FDI) also rose, adding 4.8%.
Uzbekistan focused gold miner Oxus Gold (AIM: OXS) was one of the leading fallers among the juniors, slumping 9%. Philippines focused gold producer Medusa Mining (AIM&ASX: MML), Argentina operating gold explorer Patagonia Gold (AIM: PGD) and Platmin (TSX, AIM: PPN) followed, shedding 7%, 6% and 5% respectively. Fiji focused gold producer Vatukoula (AIM: VGM) pulled back 3.4%.
Nickel and copper fall to weaken miners
Base metals kept on falling. Copper declined to US$2.66/pound, while Nickel slid to US$7.50/pound. Zinc held steady at US$0.83/pound.
Base metals focused miners also were off to a weak start. Rio Tinto (LSE: RIO) was the leading faller, shedding 2.7%. Vedanta Resources (LSE: VED), Kazakhmys (LSE: KAZ) and Anglo American (LSE: AAL) also lost over 2%. Antofagasta (LSE: ANTO) and Eurasian Natural Resources (LSE: ENRC) declined almost 2%.
The world’s largest miner BHP Billiton (LSE: BLT) started the day with marginal losses.
London's only listed pure iron ore producer and FTSE 250 constituent, Ferrexpo (LSE: FXPO) moved against the tide, holding on to the opening level and making marginal gains in early trade.
Indonesia operating coal miner Churchill Mining (AIM: CHL), which confirmed it had received approaches for its projects and for takeover of the whole company, added a further 11% on top of its recent gains today, emerging as the leading riser among the junior base metals miners. Australian focused coking coal producer Caledon Resources (AIM: CDN) rose over 4% on top of Friday’s gains.
Uranium and copper explorer Kalahari Minerals (AIM: KAH) moved with the market, declining almost 7%.
Banks, insurance, private equity
Banks mostly were in decline today. Partly nationalised banking groups Lloyds (LSE: LLOY) and Royal Bank of Scotland (LSE: RBS) were at the bottom of the pile with declines of 3.3% and 2.8% respectively. Barclays (LSE: BARC) shed 1%, while HSBC (LSE: HSBA) remained on positive ground, albeit barely. Standard Chartered (LSE: STAN) led the pack with a 1% climb.
Insurers were mixed. Prudential (LSE: PRU) fell 3%. Aviva (LSE: AV) was flat, while Friends Provident (LSE: FP), RSA Insurance Group (LSE: RSA) and Standard Life (LSE: SL) declined marginally. Old Mutual (LSE: OML) and Legal & General (LSE: LGEN) rose marginally.
Private equity group 3i (LSE: III) added 1%.
Large and Mid Cap News
Kesa Electricals PLC (LSE: KESA) said it appointed Dominic Platt as finance director, and he will join as an executive director of the board in early January 2010. Platt is currently group financial controller at Cable and Wireless PLC (LSE: CW), the electrical retailer added.
888 Holdings PLC (LSE: 888) said its subsidiary Dragonfish has signed an exclusive agreement with South African Tsogo Sun Gaming Group (TSG) to set up a joint venture in South Africa providing a licensed and regulated ‘sportsbook’ online service.
British software group Autonomy Corp (LSE: AU) announced a license agreement with US pharmaceutical group Pfizer Inc (NYSE: PFE) to provide Autonomy’s propriety ‘Intelligent Data Operating Layer’ software.
Small Cap News
Plant Impact PLC (AIM: PIM), which develops and markets ecologically friendly crop nutrition and crop protection products, announces it has triggered the first regulatory milestone payment from its BugOil licensing agreement with Arysta LifeScience Corp.
Churchill Mining PLC (AIM: CHL) confirmed it has received three separate and unconnected non-binding approaches, all of which are at various stages.
Oil and gas exploration and production company Ascent Resources PLC (AIM: AST) said its 45.23 percent owned subsidiary PetroHungaria Kft has begun a further sidetrack of the PEN-104 well (PEN-104AA), to test a substantial Miocene volcani-clastic prospect in the Penészlek field in the Nyírség permits of north eastern Hungary.
Shares in Kryso Resources (AIM: KYS) jumped over 20% this morning after the Tajikistan operating gold miner reported on drilling results from its wholly owned Pakrut gold project, which it said were “highly encouraging,” intersecting a number of high-grade intervals.
Chariot Oil & Gas (AIM: CHAR) said it had secured extensions of initial explorations periods of its licenses for areas offshore Namibia, buying more time to evaluate the blocks and look for farm-out partners.
Eurasia Mining (AIM: EUA) announced today it was now debt-free following a full capital reorganization which was completed in June, and it reported “excellent progress” at its West Kytlim project in the Urals.
Oil and gas junior Resaca Exploitation (AIM: RSOX), which is focused on the Permian Basin in the US, reported increases in its oil and gas reserves along with higher production rates at its flagship Copper Jal Field following increases in water injection. With the oil prices picking up, Resaca said it was restoring production from previously shut-in minor properties and was “well positioned” to further expand its activities.
Marketing software specialist smartFOCUS Group PLC (AIM: STF) said it won a contract with cruiseline operator Carnival UK (LSE: CCL) under which the company will implement, support and enhance Carnival's marketing campaigns across its P&O Cruises, Cunard Line, Princess Cruises and Ocean Village brands.
UK based software developer Advanced Computer Software (AIM: ASW) announced the acquisition of Indian developer Oak Labs Private Ltd. The deal sees ACS significantly enhance its development operation for an undisclosed fee, which will be paid by a combination of cash and equity. Shares in ACS rose 3% this morning as investors welcomed the latest acquisition in their development strategy.