Overview: the Footsie’s movements were consistent with pre-market predictions as the blue chip index rose slightly in the morning, adding 0.5% by early afternoon with bailed out banks Lloyds (LSE: LLOY) and RBS (LSE: RBS) in the lead with gains of 3.5% and 4.5%
Other financial stocks also were on the rise as another bank Barclays (LSE: BARC), hedge fund manager Man Group (LSE: EMG) and insurers Prudential (LSE: PRU) and RSA Insurance Group (LSE: RSA) made it to the leaderboard, advancing 2%.
Car insurer Admiral Group (LSE: ADM) also did well, climbing 3.5%.
Other notable risers included asset management company Schroders (LSE: SDR), support services group Rentokil (LSE: RTO) and broadcaster BSkyB (LSE: BSY), all of which added nearly 2%.
Only a handful of FTSE 100 constituents lost more than 1% this morning. These included oil and gas companies Tullow Oil (LSE: TLW) and Petrofac (LSE: PFC), miners Xstrata (LSE: XTA) and Rio Tinto (LSE: RIO) as well as commercial property company Land Securities Group (LSE: LAND) and engineering company AMEC (LSE: AMEC).
US stock index futures rose this morning, pointing to a higher start on Wall Street in anticipation of the weekly jobless claims update that is due today. Futures for the Dow Jones Industrial Average, the Standard & Poor’s 500 index and the Nasdaq composite were about 0.3% higher.
Commodities
Oil prices slid today with January Brent Crude declining to US$72.75/barrel, while US benchmark crude slipped below US$71/barrel.
Oil and gas stocks were mixed this morning. Supermajors BP (LSE: BP) and Shell (LSE: RDSB) declined marginally, while Petrofac (LSE: PFC) lost 1.2% and Tullow Oil (LSE: TLW) declined 1.5%. BG Group (LSE: BG) and Cairn Energy (LSE: CNE) went against the tide, adding less than 1%.
Midcaps mostly declined. Heritage Oil (LSE: HOIL) was down 1.2%, Dragon Oil (LSE: DGO) declined marginally and Dana Petroleum (LSE: DNX) held steady.
Europe focused oil and gas developer Ascent Resources (AIM: AST) emerged as the top performer in the sector, advancing 13%. Energy investor Xtract Energy PLC (AIM: XTR) and Kazakhstan operating Max Petroleum (LSE: MXP), which released its interim results today, were among the biggest fallers in the sector with losses of 7% and 6% respectively. US focused oil and gas junior Caza Oil & Gas (AIM: CAZA) and Africa and FSU operating oil and gas junior Victoria Oil & Gas (AIM: VOG) both slid 3%.
Miners slide as gold, silver and platinum continue freefall
Precious metals continued sliding as gold, silver and platinum declined to US$1,121/oz, US$17.34/oz and US$1,411/oz, respectively.
Mining stocks were mixed this morning. Gold miner Randgold Resources (LSE: RRS) and platinum producer Lonmin (LSE: LMI) lost less than 1%, while fellow FTSE 100 constituent Fresnillo (LSE: FRES) rose marginally.
Specialty chemicals firm Johnson Matthey (LSE: JMAT) also posted a small gain.
In the FTSE 250, gold miner Petropavlovsk (LSE: POG) slid 1.7%, while Aquarius Platinum (LSE: AQP) declined marginally and silver producer Hochschild Mining (LSE: HOC) tacked on less than 1%.
Kazakhstan operating gold producer and copper developer Frontier Mining (AIM: FML) and African focused nickel and gold exploration and development junior Nyota Minerals (ASX&AIM: NYO) were the top performers among the small caps, advancing 7% and 3.5% respectively.
Turkey and Saudi Arabia operating gold explorer KEFI Minerals (AIM: KEF), Uzbekistan focused gold miner Oxus Gold (AIM: OXS) and Lesotho operating diamond miner Kopane Diamond Developments (AIM: KDD) headed in the opposite direction, shedding 7%, 5% and 3% respectively.
Copper and nickel recover, but miners decline
Base metals inched higher to recoup some of their recent losses. Copper improved to US$3.08/lb, nickel reached US$7.40/lb, while zinc rose to US$1.03/lb.
With the exception of Kazakhmys (LSE: KAZ), which posted a small gain, base metal focused stocks were in decline this morning. Rio Tinto (LSE: RIO) and Xstrata (LSE: XTA) were in the lead with gains of about 1.3%. BHP Billiton (LSE: BLT) and Vedanta Resources (LSE: VED) slid 1%, while Anglo American (LSE: AAL) and Antofagasta (LSE: ANTO) shed nearly 1%. Eurasian Natural Resources (LSE: ENRC) posted a marginal loss.
London's only listed pure iron ore producer and FTSE 250 constituent, Ferrexpo (LSE: FXPO) also was in decline, retreating 2%.
Russia focused copper and nickel miner Amur Minerals (AIM: AMC) and iron ore focused investor Red Rock Resources (AIM: RRR) led the small caps with gains of 8.5% and 6% respectively.
Australia focused coking coal producer Caledon Resources (AIM: CDN) declined 6.5%, South American focused junior miner Herencia Resources (AIM: HER) was down 5.5% and zinc mining and recycling specialist ZincOX (AIM: ZOX) retreated 4.5%.
Banks, insurers, private equity
Part-nationalised Lloyds (LSE: LLOY) and Royal Bank of Scotland (LSE: RBS) led the banking sector with gains of 4%. Barclays (LSE: BARC) followed, advancing 2.5%, HSBC (LSE: HSBA) added 2% and Standard Chartered (LSE: STAN) rose 1.5%.
Insurers also were in buying mode today with Legal & General (LSE: LGEN) and Admiral Group (LSE: ADM) leading the way with advances of nearly 3%. RSA Insurance Group (LSE: RSA) and Standard Life (LSE: SL) added 2.5%, while Old Mutual (LSE: OML) and Prudential (LSE: PRU) were up 1.5% and Aviva (LSE: AV) rose marginally.
Private equity group 3i (LSE: III) rose 1.5%.
Large and Mid Cap News
International resource company, Kazakhmys (LSE: KAZ) announced it will sell a larger proportion of its Ekibastuz GRES -1 power plant to Kazakhstan’s National Welfare Fund, Samruk-Kazyna JSC. The amended deal sees the Kazakh government-backed company selling 50% of Ekibastuz for $681 million, up from 25% for $339m as announced Oct 13th 2009.
International telecommunications group, Cable & Wireless (LSE: CW) announced that it has appointed Tim Weller as its new chief financial officer for the Worldwide business unit, which is set to demerge from the group in March 2010. Weller will be joining Worldwide from his current position as CFO of United Utilities (LSE: UU)in May 2010.
Construction and support service group, Carillion (LSE: CLLN) has been named as the preferred bidder for a £450 million, Public Private Partnership project to redevelop the Southmead Hospital, Bristol. Through a joint venture with the Bank of Scotland, the FTSE250 constituent will finance the new 800-bed acute hospital, investing up to £50 million. Subsequently, Carillion is providing design, construction, maintenance and facilities management services for the project.
Environmentally focused support services group Eaga PLC (LSE: EAGA) said it is expecting double digit percentage profit growth in first half when it updated on trading for the period to 30 November 2009. Eaga shares climbed almost 2% on the London Stock Exchange following the announcement.
FTSE250 energy services group, Hunting PLC (LSE: HTG) announced its acquisition of well intervention engineers, the Welltonic Group. The deal is worth a total of £9 million, with an initial payment of £7m and a further £2m subject to performances targets over an 18 month period.
Sinclair Pharma PLC (LSE: SPH) said all shares of the firm placing and open offer first announced in October have been placed with new and existing shareholders, and admission of the shares to trading is expected on December 11, the day after the company’s AGM.
Small Cap News
South Africa and Botswana operating diamond miner Firestone Diamonds (AIM: FDI) said production from the BK11 kimberlite in Botswana was now expected ahead of schedule after the company announced increases in both the resource and grade of the deposit.
London Mining (AIM: LOND) said that a total resource for the Wadi Sawawin project in Saudi Arabia has been confirmed at 230 Mt (million tonnes) grading 41% Fe (iron), adding it now aimed to extend mine life beyond 20 year after identifying a new exploration target.
Vehicle tracking technology specialist CybIT Holdings (AIM: CYH) announced they have recommended a cash offer of 75p per share from Cyberspace Bidco Ltd, an investment vehicle for the Francisco Partners private equity group. The offer values Cybit at approximately £22.8 million.
Astaire Securities offered an upbeat forecast for the prospects of machine to machine (M2M) communications specialist Telit Communications (AIM: TCM), projecting the M2M module market to return to 20% pa (per annum) growth, while estimating the reduction in cost of profits following Telit’s relocation of manufacturing to China at as much as 20%.
Zinc mining, recycling and refining group ZincOx Resources PLC (AIM: ZOX) said bondholders have pulled out of the Jabali open pit zinc mine being built in Jemen, but that the attractive economics of the project allow it to consider a broad range of financing options.
Iron ore focused investor Red Rock Resources (AIM: RRR) said its 25.2% owned associate Jupiter Mines (ASX: JMS) has set an exploration target of 1.1 - 1.3 billion tones for magnetite at the Mt Ida prospect at the Yilgarn Iron project in Western Australia grading from 30% to 40% iron.
Sable Mining Africa (AIM: SBLM) confirmed this morning that it had completed a placing to raise £27 million for acquisitions in sub-Sahara Africa focussed on uranium and coal opportunities.
Jefferies International retained its “buy” recommendation and upped its target price for Northern Petroleum (AIM: NOP) after the Western Europe operating oil and gas company commenced production from its Grolloo field in the Netherlands, de-risking development NAV (net asset value) and leading the broker to set a target equal to its core NAV valuation.
Gulfsands Petroleum PLC (AIM: GPX) said it was notified by founder and former chief executive John Dorrier that, following the sale of shares on December 7, Dorrier has ceased to be a substantial shareholder in the company.
Gold producer Medusa Mining (ASX: MML, TSX: MLL), through its Philippines operating company Philsaga Mining Corporation, has announced an update of drilling results, with high grade intersections to the east of the Co-O Mine confirming strike extensions of the vein system to around 1,400 metres.
Empyrean Energy (AIM: EME) announced that it would be participating in the drilling of Hercules Prospect, onshore Texas which has a mean gross unrisked resource potential of 21.4 billion cubic feet. Since listing on AIM, Empyrean has focused on taking non-operating interests in prospects in the southern states in the US. US based Krescent Energy are operating the well, and have become a regular source of farm-in deals for Empyrean Energy.