Slow start to the week for FTSE
London’s blue-chips made a lacklustre start to the week today after a poor showing from heavily-weighted mining stocks hindered progress.
Disappointing production figures from platinum miner Lonmin pushed the FTSE 100 Index 19 points lower at 6697.7 by the close, with a cautious opening from US markets failing to add impetus.
Lonmin suffered a fall of nearly 7% after it said full-year sales forecasts would not be met due to production difficulties, leaving the stock 293p lower at 3985p.
The news depressed sector peers as mining firms littered the fallers’ board. Xstrata lost 61p at 3361p, Kazakhmys was off 20p at 1410p and BHP Billiton off 18p at 1509p.
Mobile phone giant Vodafone also weighed on the index earlier in the session after reports that the company was preparing a mammoth 160 billion US dollar bid for US partner Verizon sent the stock down more than 2%.
Vodafone’s later denial of any bid plans saw the stock recover some of the losses to trade 1p down at 162.2p.
Meanwhile banking stocks received a boost from positive sentiment surrounding further developments in the ABN Amro takeover saga and a number of broker upgrades.
Alliance & Leicester was the top performer with a gain of 28p to 1152p, with renewed bid speculation circling the top-flight stock.
Barclays was also higher on the news that its rival for ABN Amro, Royal Bank of Scotland had increased the cash element of its £48.2 billion move for the Dutch bank.
Barclays was ahead 4p to 728.5p, amid hopes among its shareholders that a successful RBS offer will mean Barclays is not exposed to the risks associated with integrating ABN Amro, while also making the bank a more likely takeover target.
But Royal Bank of Scotland was off 3.5p to 636.5p following news of its latest bid for the Dutch bank.
Telecoms group BT also performed well, up 3.75p at 333.5p, after Merrill Lynch raised its rating on the stock from sell to buy. It came as BT unveiled prices for watching Premier League matches on its TV download service.
Other firms benefiting from broker upgrades included drugs giant GlaxoSmithKline, up 21p at 1310p, and Financial Times owner Pearson, which cheered 9p to 834p.
Build Center business Wolseley also joined the risers after a wobbly start as brokers cut full-year profit forecasts for the group following a “disappointing” first half trading update. But shares later recovered to stand 15p higher at 1170p.
In the FTSE 250 Index, recently-floated retailer Sports Direct International, run by billionaire Mike Ashley, gained 0.75p to 192p despite press speculation the group may be heading for a profit warning.
But rival sportswear firm JJB Sports was on the backfoot, leading the second-tier fallers with a near-4% slump as investors feared downbeat trading news in an update due tomorrow. The shares were off 9.75p at 247p.
The biggest Footsie risers were Alliance & Leicester up 28p at 1152p, Reed Elsevier ahead 11p at 675p, GlaxoSmithKline up 21p at 1310p and Punch Taverns up 20p at 1323p.
The biggest Footsie fallers were Lonmin off 293p at 3985p, BG Group down 20.5p at 857p, Segro off 12.5p at 599p and and Xstrata down 61p at 3361p.
