London midday: Share prices steady down

Date: Monday 30 Nov 2009

UK share prices are stabilising at lower levels after hopes of a continued rebound from the Dubai-inspired shake-out on Thursday were quashed by disappointing UK consumer confidence figures.

Figures from market research firm Gfk NOP showed consumer sentiment fell to -17 from -13 in October.

Middle East stock markets have plunged dramatically after reopening for business following the four-day Muslim holiday of Eid, and although investors had been braced for falls, the size of them seems to have rattled the banks, where the likes of Lloyds Banking, Royal Bank of Scotland and Standard Chartered are sharply easier. HSBC defies the trend and is nursing a small gain.

Properties are also out of favour after HSBC said the real estate investment trust (REIT) sector is poised to suffer a ‘double-dip correction’ and that shares within the sector are ‘grossly over valued’.

SEGRO and British Land are the hardest hit among the big guns of the sector while among second-liners Daejan and Grainger are laid low.

In contrast, defensive sectors such as tobacco and utilities are seeing some support as the market waits to see whether the situation in Dubai will have a ripple effect on other economies. IMPs is going well in the former while Severn Trent and National Grid catch the eye in the latter.

A ray of sunshine has been provided by travel operator Thomas Cook, which posted full year pre-tax profits that were ahead of expectations as increased ticket prices offset falling customer numbers. The company posted an adjusted pre-tax profit of £308.2m, down slightly from £309.3m the previous year, as revenues climbed to £9.27bn from £8.75bn. The shares have relinquished their early gains but sector peer TUI Travel, due to declare figures on Tuesday, is still in the blue.

Aberdeen Asset’s purchase of businesses from Credit Suisse gave assets under management a boost in the year to September, but the fund manager still suffered a 20% slump in profits. Underlying profit before tax fell to £85.1m from £95.1m a year ago, but dived to £10.5m from £60.5m after exceptional items, such as costs related to acquisitions, redundancy payments and other rationalisation charges.

Oil and gas firm Cairn Energy is to make oil exploration company Capricorn a wholly owned subsidiary by buying out minority shareholder Dyas’s 9.99% stake for $95m, to be satisfied through a mixture of newly issued shares and cash.

The board of pub group Mitchells and Butlers has approached the Takeover Panel to rule whether a group of shareholders has been trying to gain control of the board after they blocked three potential candidates for chairman. Reports over the weekend suggested that one of those candidates was Archie Norman, the former head of Asda and recently appointed chairman of ITV.

Elsewhere in the sector, fellow pub groups Enterprise Inns and Punch Taverns are markedly lower.

Irish banking group Allied Irish Banks (AIB) has confirmed its participation in the National Asset Management Agency (NAMA) asset acquisition programme.

NAMA has yet to specify which of Allied Irish’s loans it intends to buy under the scheme, but expects it will be land and development loans totalling €24.2bn on a gross loan basis. Expectations are that AIB will have to take around a 30% 'haircut' on the value of its assets in return for the boost to liquidity.

Bank of Ireland also plans to join the NAMA scheme. The company said the portfolio of potential eligible bank assets to be transferred could comprise a gross book portfolio of around €16bn.

FTSE 100 - Risers
TUI Travel (TT.) 248.10p +1.81%
Severn Trent (SVT) 1,055.00p +1.44%
Compass Group (CPG) 438.30p +1.13%
Cairn Energy (CNE) 3,069.00p +0.95%
Marks & Spencer Group (MKS) 387.20p +0.91%
Imperial Tobacco Group (IMT) 1,792.00p +0.90%
Bunzl (BNZL) 630.00p +0.72%
HSBC Holdings (HSBA) 711.10p +0.68%
British Airways (BAY) 195.00p +0.62%
National Grid (NG.) 661.50p +0.53%

FTSE 100 - Fallers
Lloyds Banking Group (LLOY) 55.35p -5.55%
Royal Bank of Scotland Group (RBS) 33.28p -4.15%
Legal & General Group (LGEN) 78.35p -3.21%
Resolution (RSL) 82.30p -2.49%
Invensys (ISYS) 280.50p -2.43%
Standard Chartered (STAN) 1,486.50p -2.20%
Lonmin (LMI) 1,745.00p -2.13%
SEGRO (SGRO) 331.00p -1.90%
British Land Co (BLND) 451.30p -1.85%
Kazakhmys (KAZ) 1,215.00p -1.78%

« Go back to news channel

Email this article to a friend

or share it with one of these popular networks:

• DIGG
• FACEBOOK
• STUMBLEUPON
• MIXX
• YAHOO BUZZ
• DELICIOUS
• REDDIT
• NEWSVINE