|CATEGORY: MARKET REPORT - MIDDAY SECTOR: OIL & GAS PRODUCERS
Wed 18 Jul 2012
LONDON (SHARECAST) - After a tentative start, stocks rallied on Wednesday afternoon on the back of some upbeat comments from Ben Bernanke, the Chairman of the US Federal Reserve. Meanwhile, markets gave a rather muted reaction to the minutes of the latest policy-making meeting in the UK.
techMARK 2,066.71 +1.13%
FTSE 100 5,685.77 +1.01%
FTSE 250 11,085.68 +0.60%
Bernanke, speaking on the second day of the Fed’s semi-annual policy report to Congress, said that he does not expect the US economy to slip back into recession. European markets were initially dampened on Tuesday after Bernanke failed to hint at injecting extra stimulus in the near term but said that the central bank was ready to act.
Seven out of the nine policy makers at the Bank of England (BoE) voted in favour of increasing the asset purchase programme by £50bn to £375bn at the last meeting, while the Monetary Policy Committee (MPC) were unanimous in their decision to maintain the Bank Rate at 0.5%. However, the MPC said that new initiatives, such as the BoE's Funding for Lending Scheme (FLS), which offers cheap funding to banks to encourage lending, could make a case for an interest-rate cut in the future.
Analyst Philip Shaw from Investec said: “Overall we suspect that QE will remain the authorities’ principal stimulus weapon and that the MPC will look through the volatility of the economic data (very weak in Q2, stronger in Q3) and sanction another £50bn of asset purchases later during the year."
In other news, UK unemployment fell by 65,000 to 2.58m in the three months to May, according to the Office for National Statistics. The jobless rate dropped from 8.3% to 8.1%, better than the consensus estimate of 8.2%. Nevertheless, the number of people claiming jobless benefits rose by more than expected.
FTSE 100: Tullow pleases with Wawa-1 well update
Oil and gas giant Tullow made gains after finding oil and gas-condensate at its Wawa-1 well offshore Ghana, likely to reassure shareholders who were disappointed on Monday after the firm plugged and abandoned a well in Guyana due to safety concerns. Credit Suisse raised its target price on the stock to and maintained its ‘outperform’ rating on the shares.
Fund managers Ashmore and Schroders were high risers of the day after Goldman Sachs upgraded its ratings on the stocks to 'buy' and 'conviction buy', respectively. In contrast, Scottish engineering firm Weir was one of the weakest performers after Nomura initiated coverage with a 'reduce' recommendation and a price target of 1,350p, some way below the current share price.
Publisher Reed Elsevier was friendless after the European Commission lent its weight to calls for free access to publicly funded research.
Real estate group Land Securities fell despite saying that it has seen "good momentum" on lettings across all schemes in the first quarter. Land Secs and sector peer Hammerson were being pressured lower after Barclays Capital downgraded the stocks to 'equal weight'.
Security solutions group G4S was performing well as it attempts to claw back some of the losses it has incurred over the last week - including today's gain, the stock is still down nearly 15% on last Wednesday. The group said on Monday that it will take a £35-50m loss on its Olympics contract.
FTSE 250: Homeserve surges on M&A speculation
Homeserve, the troubled emergency home repairs company, jumped despite denying it is in talks about a possible takeover.
Wireless technology and computer chip company CSR was in the red, pulling back after gaining over 30% the day before as it announced the sale of its handset connectivity technology business to Samsung. UBS downgraded the stock from 'buy' to 'neutral' this morning.
FTSE 100 - Risers
Hargreaves Lansdown (HL.) 575.50p +4.16%
Aggreko (AGK) 1,995.00p +3.48%
Tullow Oil (TLW) 1,428.00p +3.33%
Johnson Matthey (JMAT) 2,168.00p +3.09%
Burberry Group (BRBY) 1,232.00p +3.01%
Antofagasta (ANTO) 1,072.00p +2.68%
Ashmore Group (ASHM) 330.30p +2.58%
InterContinental Hotels Group (IHG) 1,554.00p +2.57%
Capital Shopping Centres Group (CSCG) 335.30p +2.41%
Standard Chartered (STAN) 1,485.00p +2.38%
FTSE 100 - Fallers
Reed Elsevier (REL) 524.50p -1.59%
Land Securities Group (LAND) 775.00p -0.77%
Weir Group (WEIR) 1,491.00p -0.73%
Hammerson (HMSO) 464.00p -0.64%
Imperial Tobacco Group (IMT) 2,534.00p -0.43%
Eurasian Natural Resources Corp. (ENRC) 386.00p -0.36%
HSBC Holdings (HSBA) 545.70p -0.31%
Tate & Lyle (TATE) 669.00p -0.30%
United Utilities Group (UU.) 696.00p -0.29%
Lloyds Banking Group (LLOY) 29.77p -0.28%
FTSE 250 - Risers
Homeserve (HSV) 187.00p +11.98%
Ruspetro (RPO) 139.00p +6.92%
Kenmare Resources (KMR) 33.66p +6.62%
Yule Catto & Co (YULC) 138.50p +6.13%
Imagination Technologies Group (IMG) 468.70p +5.68%
Elementis (ELM) 187.60p +4.80%
Hays (HAS) 69.50p +4.67%
Booker Group (BOK) 89.90p +4.23%
NMC Health (NMC) 200.00p +3.63%
Inchcape (INCH) 370.50p +3.20%
FTSE 250 - Fallers
Talvivaara Mining Company (TALV) 124.30p -5.19%
Morgan Crucible Co (MGCR) 260.30p -3.31%
Petropavlovsk (POG) 415.60p -3.01%
Melrose (MRO) 218.70p -2.80%
Dixons Retail (DXNS) 15.56p -2.57%
CSR (CSR) 284.50p -2.57%
Dechra Pharmaceuticals (DPH) 484.00p -2.32%
COLT Group SA (COLT) 121.00p -2.26%
Daejan Holdings (DJAN) 2,800.00p -2.13%
Howden Joinery Group (HWDN) 127.20p -2.08%
|Land Securities Group
|Oil & Gas Producers
|Real Estate Investment Trusts