Proactive investors

Additional information

Additional	Information
Market:	N/A
Sector:	Media
Epic:	PROACTIVE
News:	Latest news
Web Site:	Proactiveinvestors
Other Articles:	09-02-201008-02-201004-02-2010

Xstrata, Vedanta and Lonmin lead FTSE 100 rally as metals recover

Overview: the FTSE 100 rallied in late afternoon, turning early losses into a gain of 1.5% to reclaim half of the losses it suffered yesterday on the news of a possible deferment of Dubai’s debts.

Royal Bank of Scotland (LSE: RBS) and tour operator Thomas Cook Group (LSE: TCG) led the blue chips with gains of 6% and 5.5%.

Mining stocks were in demand as metal prices recovered form recent losses. Xstrata (LSE: XTA), Lonmin (LSE: LMI) and Vedanta Resources (LSE: VED) all made it to the leaderboard, advancing 5.5%, 4.5% and 3.5% respectively.

Energy company Centrica (LSE: CNE), commercial property company Segro (LSE: SGRO) and energy services business AMEC (LSE: AMEC) also did well, tacking on more than 3.5%.

Bailed out bank Lloyds (LSE: LLOY) emerged as the leading faller in the market with a 35% loss after its shareholders approved the recently announced £13.5 billion cash call.

Inmarsat (LSE: ISAT) and Intertek (LSE: ITRK) were the only other FTSE 100 constituents to shed 1% or more, moving down 1.5% and 1% respectively.

The US stock market, which was closed yesterday due to the Thanksgiving holiday, expectedly opened with losses as the Dow Jones Industrial Average, the S&P 500 and the Nasdaq composite all were down nearly 1.5% in early trade.

Commodities

Oil prices slightly improved, but still were below yesterday’s levels. January Brent Crude stood at US$75.86/barrel, while US light, sweet crude remained at US$74.55/barrel.

Major oil and gas stocks were on the rise today.

Supermajors BP (LSE: BP) and Shell (LSE: RDSB) turned early gains into losses, cadding 1.3% and less than 1% respectively. BG Group (LSE: BG) advanced 1.2%, while Petrofac (LSE: PFC) and Tullow Oil (LSE: TLW) added nearly 2%. Cairn Energy (LSE: CNE) was the top performer in the sector in the FTSE 100 with a 3.3% gain.

Midcaps also did well with Heritage Oil (LSE: HOIL), Dragon Oil (LSE: DGO) and Dana Petroleum (LSE: DNX) climbing 2.5%, 2% and 1.5% respectively.

Eastern Europe focused junior Aurelian Oil & Gas (AIM: AUL) and Kazakhstan operating Max Petroleum (LSE: MXP) led the sector, rallying 13% and 11% respectively. Iraq and Algeria operating Gulf Keystone Petroleum (AIM: GKP) followed with a 9% gain. US focused junior Empyrean Energy (AIM: EME), oil and gas company with assets in Iraq, Syria and Gulf of Mexico Gulfsands Petroleum (AIM: GPX) and Mongolia-focused Petro Matad Ltd (AIM: MATD) added more than 3%.

Europe focused oil and gas developer Ascent Resources (AIM: AST) led the fallers, slipping 16%. South American Focused explorer Pan Andean Resources (AIM: PRE) and US focused oil and gas junior Caza Oil & Gas (AIM: CAZA) also were in selling mode with losses of 6% and 5.5% respectively.

Peru, Colombia and Cuba operating oil and gas explorer and producer Gold Oil (LSE: GOO) and North American based explorer Nighthawk Energy (AIM: HAWK) both lost 3.5%.

Miners mixed as gold and silver recover

Precious metals recouped some of their early losses later in the day as gold climbed back to US$1,170/oz, while silver and platinum rose to US$18.24/oz and US$1,435/oz respectively.

The mining sector was mixed today. Platinum producer Lonmin (LSE: LMI) was in the lead with a 4% gain. Gold miner Randgold Resources (LSE: RRS) followed, advancing 2.5%, while silver producer Fresnillo (LSE: FRES) shed 1%.

Specialty chemicals firm Johnson Matthey (LSE: JMAT) climbed 1.5%.

Yamana Gold (LSE: YAU) retreated 3.7%.

Gold miner Petropavlovsk (LSE: POG) led the sector in the FTSE 250 with a 3.6% climb, while silver producer Hochschild Mining (LSE: HOC) posted a small gain, while Aquarius Platinum (LSE: AQP) declined marginally.

Iran focused gold explorer Persian Gold (AIM: PNG) led the juniors with a 10.5% advance, while Kyrgyzstan focused gold explorer and developer Chaarat Gold Holdings (AIM: CGH) and Africa operating gold miner GMA Resources (AIM: GMA) followed, tacking on 6.5% and 6% respectively.

Turkey focused gold miner Ariana Resources (AIM: AAU) and UK-registered China operating copper and gold miner Central China Goldfields (AIM: GGG) climbed 3.5%.

Uzbekistan focused gold miner Oxus Gold (AIM: OXS) went in the opposite direction, slipping 8%. Copper and gold miner EMED Mining (AIM: EMED) and Canada based junior gold developer Rambler Metals and Mining Plc (AIM: RMM) lost 6%, while Western Australia operating Norseman Gold (AIM: NGL) and Australian gold and copper prospector Solomon Gold (AIM: SOLG) moved down 5%.

Philippines focused gold producer Medusa Mining (AIM&ASX: MML) and South Africa focused emerging platinum producer Platmin (AIM: PPN) both lost more than 4%.

Kazakhstan operating gold producer and copper developer Frontier Mining (AIM: FML), Brazil focused gold miner Horizonte Minerals (AIM: HZM), Fiji focused gold miner Vatukoula Gold Mines (AIM: VGM) and Turkey focused gold exploration and development company Stratex International (AIM: STI) all pulled back 3%.

Copper and nickel bounce back

Base metals also recovered with copper returning to US$3.07/lb, nickel climbing to US$7.32/lb and zinc recapturing the US$1/lb mark.

All major base metals focused stocks were on the rise today. Xstrata (LSE: XTA) led the way with a 5% climb. Rio Tinto (LSE: RIO) and Vedanta Resources (LSE: VED) followed, advancing 3.8% and 3.3%. Kazakhmys (LSE: KAZ) and BHP Billiton (LSE: BLT) added 2%.

Anglo American (LSE: AAL), Antofagasta (LSE: ANTO) and Eurasian Natural Resources (LSE: ENRC) rose nearly 1.5%.

London's only listed pure iron ore producer and FTSE 250 constituent, Ferrexpo (LSE: FXPO) outperformed the market, climbing 5.5%.

South Africa based coal exploration and production company Strategic Natural Resources (AIM: SNR), Australia focused coking coal producer Caledon Resources (AIM: CDN) and South Africa operating chrome miner Chromex Mining (AIM: CHX) moved with the sector, climbing 5%, 3.5% and 3% respectively.

Specialty minerals exploration and development company Thor Mining (AIM: THR) went in the opposite direction, slipping 13%. Iron ore focused investor Red Rock Resources (AIM: RRR) and Tunisia focused metal miner Maghreb Minerals (AIM: MMS) declined 5%, while Botswana operating nickel and copper miner Discovery Metals (AIM: DME) lost 3%.

Banks, insurance, private equity

Lloyds emerged as the leading faller in the market, plummeting 35% after its shareholders approved the recently announced £13.5 billion equity issue.

Fellow bailed out bank Royal Bank of Scotland (LSE: RBS) moved in the opposite direction, making it to the top of the leaderboard with a gain of almost 6% after signing up for the government’s asset protection scheme.
Barclays (LSE: BARC) added nearly 3% and Standard Chartered (LSE: STAN) rose 2%, while HSBC (LSE: HSBA) rose marginally.

Insurance stocks rose today. Legal & General (LSE: LGEN) was in the lead, adding 4%. Prudential (LSE: PRU), Aviva (LSE: AV) and Standard Life (LSE: SL) advanced 3%, 2.5% and 2% respectively.

Old Mutual (LSE: OML) and RSA Insurance Group (LSE: RSA) added 1.3%.

Private equity group 3i (LSE: III) advanced 1%.

Small Cap Movers

Other notable movers among the small caps included environmental science and technology company Accsys Technologies (AIM: AXS) and IP commercialisation company Amphion Innovations (AIM: AMP), which declined 4.5% and 9% respectively. Direct marketing software developer smartFOCUS (AIM: STF) also was in selling mode, shedding more than 4%.

Large and Mid Cap News

Troubled UK banking giant Royal Bank Of Scotland (LSE: RBS) announced the signing of an accession agreement with the Treasury, which essentially sees RBS taking further capital from the government’s Asset Protection Scheme (APS) and suspend certain dividends for two years.

The Carphone Warehouse (LSE: CPW) has beaten market expectations for its interim figures and raised full year guidance due its strong performance in the first half, with headline earnings per share (EPS) almost doubling to 6 pence per share (2008: 3.2p). The group’s primary businesses both delivered significant growth and cash flow improvements and the company’s demerger plans are on track for March.

Domino's Pizza UK & IRL (LSE: DOM)(“Domino’s”) announced this morning that it had decided to abandon a previously announced tender offer to buy-back shares at a price of  317 pence per share. The withdrawal of the tender offer was due to recent share price movements, which has caused the tender price to exceed the maximum price under the company’s current buy-back authority.

Small Cap News

Europe focused oil and gas developer Ascent Resources (AIM: AST) has placed 120 million shares to raise £5 million to accelerate the development of projects that can produce near-term cash flow.

Shares in Hartest Holdings (AIM: HTH)(“Hartest”) were on the move this morning after Delta Controls Limited announced that it had upped its offer for the company to 61 pence per share in cash.  On October 8, Delta Controls made an indicative offer of 50 pence per share.

UK based property development group, Terrace Hill Group (AIM: THG) (‘Terrace Hill’) announced the sale of its freehold interests in the Kean House development in Covent Garden for £16 million, which represents a net initial yield of 6.4%.

The soon to merge Origo Sino-India (OSI; AIM: OSI) and Origo Resource Partners (ORP; AIM: ORP) have acquired a 21% stake in Mongolian thermal and coking coal producer Gobi Coal and Energy for US$15 million to become the largest shareholders in the company, which has a number of earlier stage coal projects in Mongolia.

Agriterra Ltd (AIM: AGTA), which invests in or acquires businesses and projects operating in the agricultural and associated civil engineering industries in Africa,  said it has made strong progress since changing its strategy to focus on agriculture and is confident that its grain processing and cattle herding businesses will continue to perform well over the next financial year.

The acquisition of Swedish workforce software company Time Care AB by Allocate Software (AIM: ALL) met with a positive response from Edison Investment Research, which reacted to today’s news by valuing the company at nearly 100 pence per share.

Philippines-focused gold producer Medusa Mining (AIM, ASX: MML) has commenced trading on the Toronto Stock Exchange under the trading code of MLL.

Few investors like the work dilution, but if money must be raised, it is always a fillip if the company manages to do it at a premium to their share price. That was the thoughts of investors this morning, when oil and gas exploration and production company Forum Energy (AIM: FEP) (“Forum”) announced that it had placed £1.5 million at 50 pence per share – a 25% premium to yesterday’s closing price of 40 pence.

Venture management company ANGLE PLC (AIM: AGL) said its Management Services business has won a £2.3 million three year contract to deliver a product from the UK government’s Solutions for Business portfolio, called ‘Innovation Advice and Guidance in Lincolnshire’, on behalf of  Lincolnshire County Council.

Legion Group (AIM: LGNG)(“Legion”) announced a placing of approximately 53.1 million new shares at 1.88p per share to raise £1 million. The AIM listed security service group also released its Interim Results for the six months ended 30th September, in which Legion doubled turnover to £31.2 million and increased gross profit by 88% to £5.1 million.

Gulfsands Petroleum PLC (AIM: GPX) said it was notified by founder and former chief executive John Dorrier that, following the sale of shares on November 25, Dorrier is now interested in 4,245,288 shares representing 3.53 percent of the company's issued share capital.

ECO Animal Health Group (AIM: EAH) reported higher half yearly revenues and profits as sales improved despite challenging market conditions, envisioning further progress with new launches in the Ecometrin group of products and further marketing authorisations for Aivlosin expected in the near future.

Allocate Software PLC (AIM: ALL) said it has agreed terms for acquiring Time Care AB, a Swedish provider of workforce management software with a strong focus on the healthcare market, and it announced a placing to raise approximately £8 million after expenses.

Nature Group (AIM: NGR) said its subsidiary Nature Environmental Solutions Ltd could make US$4.2 million in revenues after receiving a letter of intent from the Unique Maritime Group and Tile Marine Emirates Environmental JV (joint venture) to award a deal to provide plant and technical services to the tanker facilities and dry dock soon to be built in Duqm, Oman.

Register here to be notified of future Proactiveinvestors articles.