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Fresnillo, Xstrata, Lonmin, Cobham, Man Group, ENRC and Kazakhmys rise to lift FTSE 100

Last updated: 05:50 18 Nov 2009 EST, First published: 06:50 18 Nov 2009 EST

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Overview: buoyed by higher metal prices, the mining sector performed strongly in the morning and early afternoon, helping the FTSE 100 turn early losses into gains. The blue chip index, which slid just below the opening level in early trade, stood 0.3% in the black at midday.

Base metals focused miner Xstrata (LSE: XTA), platinum producer Lonmin (LSE: LMI) and silver miner Fresnillo (LSE: FRES) emerged atop the leaderboard, advancing 5%, 4% and 3.7% respectively. Defence and aerospace systems manufacturer Cobham (LSE: COB) and alternative investment management business Man Group (LSE: EMG) were the only non-mining stocks to make it to the top ten, rising 3.3% and 2.5% respectively.

The fallers were led by outsourcing company Capita Group (LSE: CPI), which shed almost 5% despite saying it was on track to deliver underlying profit growth for 2009 in line with market expectations.

Heating and plumbing equipment manufacturer Wolseley (LSE: WOS), which said today its trading remained with expectations, was down 4%. Insurance focused investor Resolution (LSE: RSL) continued its decline today, shedding 3% to emerge on the top fallers list for a third consecutive day. Telecom company Cable & Wireless (LSE: CW) lost 2%, while retailer Sainsbury (LSE: SBRY) and fashion house Burberry (LSE: BRBY) followed with losses of over 1.5%, as did mobile operator Vodafone (LSE: VOD), which went ex-dividend today. Other ex-dividends included banks HSBC (LSE: HSBA), Barclays (LSE: BARC) and food manufacturer Unilever (LSE: ULVR).

Stock index futures in the US were unchanged after the main indices set new highs for this year on Tuesday, pointing to a flat start today.

Commodities

Oil prices rose with December Brent Crude stopping just 9 cents short of US$80/barrel, while US light, sweet crude for December delivery reached US$80/barrel.

With the exception of Cairn Energy (LSE: CNE), which posted small losses to start the day, all blue chip oil and gas companies rose.

Supermajors BP (LSE: BP) and Shell (LSE: RDSB) added less than 1%, as did other FTSE 100 constituents BG Group (LSE: BG), Petrofac (LSE: PFC) and Tullow Oil (LSE: TLW).

Midcaps were mixed as while Dragon Oil (LSE: DGO) and Dana Petroleum (SLE: DNX) advanced 2% and 1.3% respectively, Heritage Oil (LSE: HOIL) posted a marginal decline.

Iraq operating Irish oil company Petrel Resources (AIM: PET) was the top performer among the juniors, rising 5%. Ukraine focused gas producer, Regal Petroleum (AIM: RPT) and Atlantic Canada operating oil and gas group Enegi Oil (AIM: ENEG) followed with gains of over 3%. Gulfsands Petroleum (AIM: GPX), an oil and gas company with assets in Iraq, Syria and Gulf of Mexico, also climbed, adding 2.5%.

Eastern Europe focused junior Aurelian Oil & Gas (AIM: AUL), energy investor Xtract Energy PLC (AIM: XTR) and US focused junior Empyrean Energy (AIM: EME) headed in a different direction, sliding 6.5%, 4% and 3% respectively.

Gold and silver climb to boost miners

Gold hit new highs today, climbing to US$1,145/oz. Silver and platinum followed, improving to US$18.62/oz and US$1,461/oz respectively.

All major mining stocks were on the rise early in the day. Silver producer Fresnillo (LSE: FRES) and platinum miner Lonmin (LSE: LMI) were among the leading performers in the market with gains of over 4%. Gold miner Randgold Resources (LSE: RRS) followed, climbing 1.5%.

Specialty chemicals firm Johnson Matthey (LSE: JMAT) added 2%.

Aquarius Platinum (LSE: AQP) led the mining sector in the FTSE 250 with a 5.3% advance. Silver producer Hochschild Mining (LSE: HOC) and gold miner Petropavlovsk (LSE: POG) followed, gaining 3%.

Yamana Gold (LSE: YAU) added 1.2%.

Iran focused gold explorer Persian Gold (AIM: PNG) led the small caps, rising 7.5%. South Africa and Botswana operating diamond miner Firestone Diamonds (AIM: FDI) and Western Australia operating Norseman Gold (AIM: NGL) followed with 3.5% gains.

Turkey and Saudi Arabia operating gold explorer KEFI Minerals (AIM: KEF) was the top faller among the juniors, slipping 11%, while UK-registered China operating copper and gold miner Central China Goldfields (AIM: GGG) tumbled 8%.

Commodity asset development company Mercator Gold (AIM: MCR) and Africa focused gold miner Pan African Resources (AIM: PAF) both lost more than 3%.

Base metals rise

Base metals also improved with copper and nickel climbing to US$3.15/lb and US$7.85/lb respectively, while zinc rose to US$1.03/lb.

Xstrata (LSE: XTA) led the base metals focused miners with a 4% climb. Rio Tinto (LSE: RIO) and Vedanta Resources (LSE: VED) followed with gains of nearly 3%. BHP Billiton (LSE: BLT) and Kazakhmys (LSE: KAZ) rose about 2.5%, while Eurasian Natural Resources (SLE: ENRC) added 2%. Antofagasta (LSE: ANTO) lagged behind with a 1.4% gain, while Anglo American (LSE: AAL) rose marginally.

London's only listed pure iron ore producer and FTSE 250 constituent, Ferrexpo (LSE: FXPO) outperformed the sector, rising 6.5%.

Juniors didn’t show much movement in early trading. Mineral sands producer Kenmare Resources (LSE: KMR) was in the lead with a 6% gain, while Uranium and copper explorer Kalahari Minerals (AIM: KAH) added nearly 3%.

Australia focused coking coal producer Caledon Resources (AIM: CDN) and Philippines operating nickel miner Rusina Mining (ASX: RML; AIM: RMLA) went in the opposite direction, shedding 4%. Russia focused copper and nickel miner Amur Minerals (AIM: AMC) retreated 3%.

Banks, insurance, private equity

With the exception of Barclays (LSE: BARC), which gained 1%, all major banking stocks were in selling mode early in the day. Royal Bank of Scotland (LSE: RBS) was at the bottom of the pile with a 1.5% loss, while fellow part-nationalised bank Lloyds (LSE: LLOY) was flat. HSBC (LSE: HSBA) and Standard Chartered (LSE: STAN) declined marginally.

Insurers mostly rose. Prudential (LSE: PRU) was in the lead with a 1% gain. Car insurer Admiral Group (LSE: ADM), Aviva (LSE: AV), Old Mutual (LSE: OML) and RSA Insurance Group (LSE: RSA) rose marginally. Legal & General (LSE: LGEN) and Standard Life (LSE: SL) lost less than 1%.

Private equity group 3i (LSE: III) posted small gains.

Small Cap Movers

Other notable movers among the small caps included environmental science and technology company Accsys Technologies (AIM: AXS) and novel pesticides and plant nutritional products developer Plant Impact (AIM: PIM), which lost 6% and 7% respectively.

Large and Mid Cap News

In its quarterly interim statement, building supplier Wolseley plc (LSE: WOS) said its overall trading environment was ‘extremely tough’ as the company reported a 13% decline in revenues and a 41% decline in profits compared with 2008. Despite the reduced revenues Wolseley also said the majority of the Group's business units maintained or improved their market share in the quarter.

ITV plc (LSE: ITV) announced the appointment of Archie Norman as the company's new Non Executive Chairman.

In its half year statement, Experian (LSE: EXPN) revealed another ‘strong half’, which included good organic revenue growth and cash flow performance. According to Experian’s Chairman John Pearce, the company is ‘advantageously positioned to further develop and grow’.

Small Cap News

Supplier of bead and drug eluting bead products Biocompatibles International (AIM: BII) has acquired the inventory and intellectual property assets of Astron Clinica Limited, which is currently in administration.

Mobile email and data synchronisation group Synchronica PLC (AIM: SYNC) has announced the appointment of Michael Edward Wilson Jackson, known for his long history of investment in emerging technology businesses, to the board as a non-executive director with immediate effect.

Maritime identification and tracking technologies developer Software Radio Technology (AIM: SRT) reported a strong set of interim results, starting to see the “fruits of its long term strategy” as revenues jumped 122% and the losses declined more than tenfold.

Shares in The Capital Pub Company (AIM: CPUB) were in demand this morning after the London focused pub owner and operator revealed a 20% increase in pre-tax profits and a 23% increase in basic earnings per share (EPS).

Investment company Altus Resource Capital Limited (AIM: ARCL) is considering another placement following this year’s share issue to raise capital to take advantage of market opportunities, anticipating increased M&A (mergers and acquisition) activity in the gold mining sector.

IP commercialisation company Amphion Innovations (AIM: AMP) has announced that its portfolio company Kromek has won yet another award, winning the title of the Security SME (small and medium sized enterprises) of 2009 at the Global Security Challenge competition in London.

Kalahari Minerals PLC (AIM: KAH) said a further exploration update issued by Extract Resources Ltd (TSX, ASX: EXT) for the Rossing South uranium deposit at the Husab project in Namibia reinforces its belief that the estimated resource figure of 500 million pounds triuranium octoxide (U3O8) for the project is highly conservative.

Shares in Philippines-focused gold producer Medusa Mining Limited (ASX: MML) have jumped 9 cents in overnight trading in Austrlia, following chairman Kelvin Tomlinson's address at the company's annual general meeting (AGM), where he revealed his plans in early 2010 were to focus on attaining its immediate target production of 100,000 ounces annually.

Asterand PLC (LSE: ATD) reported encouraging trading for the first nine months of the financial year and announced it plans to buy privately-held drug discovery services company BioSeek Inc for up to US$14 million in cash and shares, dependent on sales performance in 2010.

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