Last checked at LONDON (Alliance News) - The following stocks are the leading risers and fallers within the main London indices midday Monday.
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FTSE 100 - WINNERS
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Fresnillo, up 2.3%, Glencore, up 2.0%, Anglo American, up 1.5%, BHP Billiton, up 1.3%, Rio Tinto, up 1.0%. Most of the top gaining blue chip stocks are miners Monday, given the expectation of continued strong demand from China after comments made by the country's Premier Li Keqiang in an open letter in The Times newspaper Monday that implied continued government support for the world's second-largest economy.
Tullow Oil, up 2.1%, Royal Dutch Shell, up 0.6%. The oil producers are continuing to benefit from a higher oil price as uncertainty in Iraq continues. The International Energy Agency is reported to have forecast that roughly 60% of the growth of production capacity amongst the Organisation of the Petroleum Exporting Countries over the next decade would come from Iraq, highlighting why the current turmoil and its potential the disruption of Iraq's oil exports have sent prices higher.
Royal Bank of Scotland, up 0.3%. RBS is outperforming following reports in The Times newspaper at the weekend that the bank is in talks over a restructuring of its Ulster Bank unit that could overcome a hurdle to selling some of the government’s majority stake. Without saying where it got its information, the newspaper reported that the taxpayer-backed lender is working on a plan to attract private equity into Ulster to boost its capital position before the business is merged with another Irish bank.
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FTSE 100 - LOSERS
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Persimmon, down 2.2%. The housebuilder is amongst the worst performing in the sector following the latest Rightmove house price index, which showed a more tepid UK housing market than in recent months. The index recorded a rise in price of just 0.1% month-on-month in June, following the 3.6% jump in May. House prices rose 7.7% year-over-year in June, a slower rate of increase than the 8.9% rise in May. House prices in most of the regions declined in June compared to the previous month, with prices in London decreasing 0.5% due mainly to a combination of buyer reluctance and over 20% more sellers entering the market this month, Rightmove said.
Rolls-Royce, down 1.8%. Societe Generale has downgraded the UK engineering firm to Sell from Hold, cutting its price target to 950 pence from 1,070 pence. The downgrade follows a share price slump last week for Rolls-Royce after Emirates announced that it was cancelling a large order for Airbus planes, for which Rolls-Royce would have supplied engines.
Smith & Nephew, down 1.3%. The medical equipment company appears to have lost out on a potential takeover offer after one of the companies cited as a potential suitor announced its intention to spend its cash elsewhere. Smith & Nephew shares have been particularly volatile recently amid heightened merger speculation within the medical-products sector. Medtronic Inc. had previously been identified as a potential suitor for Smith & Nephew. However the US medical device maker agreed late Sunday to acquire smaller Irish rival Covidien PLC in a deal valued at about USD42.9 billion, making an offer for Smith & Nephew look unlikely at this stage.
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FTSE 250 - WINNERS
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Polymetal International, up 4.6%. Premier Oil, up 2.2%. AMEC up 1.3%. In a similar picture to the FTSE 100, oil and mining stocks are the best mid-cap performers given the higher oil price and the expectation of economic stimulus in China.
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AIM ALL-SHARE - WINNERS
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UK Oil & Gas, up 23%, Solo Oil, up 16%, Stellar Resources, up 11%. The companies linked to the Horse Hill oil and gas project in the Weald Basin near Gatwick Airport are all higher after the project operators said they had started building the site for the Horse Hill-1 well and expected to start the actual well in July. Solo Oil has a binding agreement in place to own a direct 10% interest in Horse Hill Development Ltd, a special purpose company that owns a 65% participating interest and operatorship of the Horse Hill Prospect. Stellar Resources and UK Oil & gas both have binding agreements to own a direct 7.5% interest in Horse Hill Development.
TXO, up 13 pence. Shares in investment company jumped Monday after it announced that its investee company, Athabasca Resources Ltd, has raised GBP305,000 and appointed advisers ahead of its proposed initial public offering on AIM in September. The company said that the GBP305,000 Athabasca had raised through a private placement was sufficient to cover the deposit for its farm-in agreement for 50% of four leases with Nordic Petroleum AS, as well as the initial costs of its AIM admission.
Range Resources, up 12%. The hydrocarbon exploration firm said Monday that its average Trinidad production has increased by 18% to an average of 630 barrels of oil per day, from the 533 barrels of oil per day it reported back in April. The company said the production increase was primarily due to excellent results at its QU 452 well in the South Quarry field, which it said is producing at a stabilised rate of 70 barrels of oil per day of very light 470 API oil on a 5/32" choke.
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AIM ALL-SHARE - LOSERS
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AorTech, down 25%. Shares in the medical equipment company have dropped after it said it expects to post exceptional charges for the year to end-March as a result of launching litigation against its former chief executive, Frank Maguire. The company expects to post a loss before interest, tax, exceptional costs and amortisation of around USD1.0 million, with revenue of around USD600,000. Maguire stepped down last December following the company's transition from a medical polymer manufacturing business to a pure-play intellectual property exploitation company. AorTech said it has taken legal proceedings against Maguire relating to "certain alleged activities" Maguire undertook whilst he was an employee.
Artilium, down 14%. The telecommunication software and services company warned Monday that earnings in the second half of the year will be lower than the first half due to challenging operating conditions, as the company announced that both its chairman and its chief executive officer will resign on July 1. In a statement Monday, Artilium said challenging conditions in its operating environment have persisted, and it continues to experience lengthening sales cycles from its customers.
Gaming Realms, down 13%. The AIM-listed online products developer reported strong revenue growth in the first half of the year from new players and paying users, but said its losses widened in the period as it continued to invest heavily in marketing. The group reported a pretax loss of GBP4.9 million for the six months to March 31, compared with a GBP3.4 million loss a year earlier, which it said included a marketing spend of GBP5.2 million and the cost of building its internal gambling platform. The prior year Gaming Realms spent GBP1.8 million in marketing.
Zambeef Products, down 11%. The food producer's shares have fallen after the group said it swung to a loss in the first half of its financial year, hit by increased competition and currency depreciation. For the six month to March 31, Zambeef recorded a pretax loss of USD6.5 million, compared to a pretax profit of USD6.4 million the prior year. Revenues in the period fell 9% to USD140.2 million from USD153.4 million a year earlier, while gross margins narrowed to 32.7% from 36.3%.
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By Jon Darby; jondarby@alliancenews.com; @jondarby100
Copyright 2014 Alliance News Limited. All Rights Reserved.
19 Aug 2014 11:14
