London midday: Upward trend continues

Blue-chips shares continue to push ahead, led by minders in the wake of the decision by Rio Tinto to change tack with regards to its fund raising plans.Rio Tinto has capitulated to shareholder pressure and ditched its controversial $19.5bn refinancing deal with state-owned Chinese aluminium producer Chinalco. Rio is instead addressing its need for cash by launching a $15.2bn rights issue. Rio has also arranged a merger of West Australia iron ore assets with those of bitter rival BHP Billiton, the company that pulled the plug on its bid for Rio Tinto last year.Both Rio Tinto and BHP Billiton are sharply higher, while smaller yet still significant rises are made by most of the other major players in the sector, helped by firmer metals prices. Carphone Warehouse reiterated its 2010 full-year guidance and said it will split itself into two separately listed companies by July next year. The group also reported full-year results. Headline pre-tax profits came to £133m in the year ended 31 March compared with £4m last time on sales of £1,385m from £1,424m previously.With the cut-off point for the quarterly reshuffle of the FTSE 100 constituents due to take place next week investors are speculating on the likely winners and losers. Private equity investor 3i Group is the best performing FTSE 250 stock on expectations it will make a return to the blue-chip index, while current FTSE 100 index members Amlin, the insurer, and Whitbread, the hotels and restaurant group, come under selling pressure as they face relegation from the top tier.Travel group Thomas Cook is in the gloom on fears that parent company Arcandor may have to dump or reduce its 52.8% stake. Arcandor applied for state aid from the German government last night but is by no means certain to get it.Housebuilder Bellway's southern based divisions have experienced a marginally stronger market and will see higher turnover by the year end than the northern based divisions whose markets still remain fragile. Net reservations since 1 February have continued to average 105 per week, securing the volume target of 4,200 homes.Oil and gas giant BG Group has had more success in the Santos Basin, Brazil. A wireline test confirmed the presence of light oil located at depths of around 5,000 metres. Drilling is ongoing at the well, which is located around 250km offshore from Rio de Janeiro and 33km northwest of the Tupi well.Real ale brewer and London pub estate owner Fuller, Smith and Turner holds steady after edging its dividend higher from 6.9p to 7p, despite experiencing a 'very difficult year given tough market conditions.' Profit before tax fell to £14.4m in the year ended 28 March compared with £23.8m last time on revenue up 3% to £210m.SThree, the specialist staffing business, experienced an overall decline in demand for its services in the six months to May, particularly for permanent placements with contract hiring proving somewhat more resilient in all territories. Toy racing car and train set maker Hornby scrapped its final dividend as a combination of the weak pound and recession sent profits tumbling. Software supplier Formjet slumped further into losses in 2008 after a dire fourth quarter and losses incurred from an aborted acquisition. However, the shares stormed higher as it said total turnover in the first four months of 2009 was up 23.5% on the same period in 2008.Shares in Dragon Oil give back some of the sharp gains seen yesterday when the company revealed it has received a preliminary bid approach. The company's majority shareholder, Emirates National Oil (ENO), which has a 52% stake in the UK oil and gas company, has admitted it made the approach to buy up the rest of the shares, but cautioned any offer would only be at a "modest premium" to Wednesday's closing price of 338p. The share price remains well above 338p, however, suggesting the market thinks ENO could be persuaded to go higher in its bid for total ownership.Private aviation services group Air Partner is losing altitude after disclosing that this year's profits will be below current market expectations.FTSE 100 - RisersRio Tinto (RIO) 3,039.00p +11.73%BHP Billiton (BLT) 1,563.00p +7.35%Vedanta Resources (VED) 1,630.00p +6.82%Eurasian Natural Resources (ENRC) 671.50p +5.58%FTSE 100 - FallersThomas Cook Group (TCG) 218.75p -2.89%Amlin (AML) 331.00p -2.50%Liberty International (LII) 413.25p -1.61%Hammerson (HMSO) 299.00p -1.32%