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LONDON (Alliance News) - Trading volumes are expected to be thin for the rest of Thursday, with US investors off for the Thanksgiving Day holiday, as London-listed equities drifted higher with support coming from the market's heavily weighted mining sector.
Glencore was up 3.4%, KAZ Minerals up 3.2% and Antofagasta up 2.3%. The London mining sector was being supported by a rise in the price of copper after reports stating Chinese regulators may launch a probe into short-sellers in local metals markets.
Bloomberg reported regulators have begun to collect some records of trading activity following a request from the China Nonferrous Metals Industry Association, according to people who asked not to be identified because they aren't authorized to speak publicly on the matter.
"Short-selling is a symptom not the cause of weakness in metals prices, so the bounce in both copper and mining companies could be short-lived," Jasper Lawler, market analyst at CMC Markets said.
The notable exception to the mining sector rally was BHP Billiton, which was the worst-performing FTSE 100 stock, down 2.3%. The Anglo-Australian miner moved to quell an accusation that the waste which was released by the tailings dam burst at the Samarco mine in Brazil was toxic.
A probe conducted by the United Nations claimed the waste from the mine spill is toxic and said the steps taken by BHP and Vale to prevent harm were not sufficient. BHP responded that the tailings released into the Rio Doce were comprised of clay and silt material from the washing and processing of earth containing iron ore, which is naturally abundant in the local area. It added that, based on available data, the tailings are chemically stable.
Additionally Thursday, JPMorgan cut its rating on BHP shares to Underweight from Neutral and slash its price target to 750 pence from 1,300p. SocGen cut its price target for BHP to 915p from 1,050p. BHP shares were trading at 833.50p at midday.
The FTSE 100 index traded up 0.6% at 6,375.48 points, the FTSE 250 was flat at 17,114.38, and the AIM All-Share was up 0.1% at 730.73.
European stocks were pushing higher as investors looked ahead to the European Central Bank's monetary policy decision next week. Analysts are hoping for more easing measures from the ECB, which could cut interest rates further into negative territory and expand and extend its quantitative easing programme. The CAC 40 in Paris was up 1.2% and the DAX 30 in Frankfurt up 1.6%.
Wall Street is closed Thursday for Thanksgiving, reopening for a half day on Friday.
Elsewhere on the London Stock Exchange, a number of companies going ex-dividend were amongst the worst performers. National Grid traded down 1.9%, SABMiller was down 0.2% and Lancashire Holdings down 10%.
FTSE 250-listed payment services company PayPoint traded down 7.5%. The group reported a considerable drop in first-half pretax profit, as the company booked a GBP18.2 million goodwill impairment charge in relation to the online payments business it is seeking to sell.
Pretax profit plunged to GBP3.2 million in the six months ended September 30, compared with GBP22.5 million in the corresponding half the prior year. PayPoint lifted its interim dividend to 14.2 pence per share from 12.4p and said the increase "anticipates double digit growth in the dividend for the year as a whole and reflects our confidence in the business and its long term prospects".
Marston's traded up 3.0% after the pub company and brewer said it swung to a profit in its recently-ended financial year as revenue grew amid new pub openings and the recently-integrated Thwaites beer business, part of a three-year transformation plan.
Marston's said it made a pretax profit of GBP31.3 million in the year ended October 3, after suffering a GBP59.2 million pretax loss the year before, as revenue rose to GBP878.6 million from GBP815.3 million. Marston's will pay a total dividend of 7.0p, up 4.5% on the prior year.
OneSavings Bank also was one of the best performers, up 3.1% after Investec upgraded its rating on the lender to Buy from Hold. OneSavings shares fell 7.3% on Wednesday after UK Chancellor George Osborne announced a new stamp duty on buy-to-let properties, against which OneSavings lends.
Analysts at Investec said the changes in the Autumn Statement has had no impact on its earnings forecast for OneSavings and, following recent share price falls, it sees good value in the company.
In the AIM All-Share index, EKF Diagnostics Holdings shares dropped 46%. EKF warned on its pretax profit for 2015 after undertaking a review of the business.
The healthcare company said the review found that it should achieve full-year revenue of around GBP32 million, but that pretax profit will be hurt by a "number of items". These include an impairment of the molecular division following a potential divestment or closure of the business, a write-off of specific debtors, and costs associated with the closure of the Separation Technology site in Sanford, Florida.
By Neil Thakrar; neilthakrar@alliancenews.com; @NeilThakrar1
Copyright 2015 Alliance News Limited. All Rights Reserved.
20 Mar 2024 12:04
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