London open: BT turns Footsie blue

Shares are inching higher in early deals as investors welcome second quarter results from BT, offsetting losses among insurers following results from Friends Provident owner Resolution.Telecoms giant BT reported second quarter revenue was in line with expectations and thinks it can cut costs by at least £1.5bn this year versus its old target of over £1bn. The company also predicts the decline in full-year revenue before one-off items will be 3-4%, slightly less than the 4-5% forecast previously. Revenue for the three months to 30 September dipped 3% to £5.12bn, but pre-tax profit slumped 44% to £275m.British Airways is up on talks its tie-up with Spanish flag carrier Iberia could go through tomorrow. Lloyds Banking Grouphas also risen after saying yesterday that it may increase its fundraising by £1.5bn to £22.5bn due to high demand for its offer to swap debt into equity. But insures are weaker after Resolution, which completed its £1.86bn acquisition of Friends Provident last week, said sales at the insurer rose 6% during the third quarter, but are down 28% this year so far.Clive Cowdery's insurance investment vehicle reported an increase in quarterly sales to £183m from £173m in the second quarter and £149m in the first three months of the year, although sales of just £505m for the nine months were way behind the £701m reported a year ago, "reflecting the difficult market conditions experienced by the life insurance industry and the actions taken by Friends Provident to improve margins". Prudential and Old Mutual fell in sympathy.Elsewhere, Centrica is trading as expected, with the gas supplier's lower effective tax rate and strong performance from the UK downstream business offsetting a drop in gas production and profitability. Gas production fell 50% in the third quarter from the same time last year and is expected to be down by about 25% for the full year.All of the assets of Kazakhi miner Eurasian Natural Resources were operating flat out at the end of September as production 'recovered to pre-financial crisis levels.' Production levels in 2010 are anticipated to be similar to those seen in 2008, including a modest first time contribution from Central African Mining & Exploration Company (CAMEC), the African mining company it is in the process of acquiring.Mobile telecommunications colossus Vodafone has entered into a strategic partnership with a leading telecoms operator in Taiwan. Vodafone and Chungwha Telecom have signed a partner market agreement to provide customers with communications services and enhanced roaming arrangements.Outsourcing group Serco said customers' need to improve efficiency in the current economic climate is providing it with more opportunities to win contracts as it reported continued strong trading. Serco, whose activities include operating London's Docklands Light Railway and vans used to transport prisoners, said it remains on track to deliver on its financial guidance for 2009.Private equity group 3i reduced losses at the interim stage and has made a substantial dent in its debt mountain, helped by its £732m right issue. Loss before tax in the six months to 30 September narrowed to £57m from £140m a year earlier, after the company took a £242m hit on exchange rate movements.AMEC, the engineering and project management company, is trading in line with expectations despite the challenging external environment. 'We expect to deliver a margin approaching 8% this year and remain confident that with the benefits of our Operational Excellence programme, we will achieve our margin target of 8.5% in 2010,' said chief executive officer Samir Brikho.Engineering IT systems provider Aveva revealed a decline in half year profit and said it remains cautious on the outlook for 2010. Adjusted pre-tax profit fell to £26.6m for the six months ended 30 September 2009 from £31.0m the year before. Revenue for the period declined to £69.9m from £74.8m in challenging market conditions.Debenhams said it has agreed to acquire Danish fellow department store operator Magasin du Nord for DKK101m (£12.3m). Magasin, which has six stores including four in the Copenhagen area , one in Arhus and one in Odense, has an annual turnover of £228.7m, Debenhams said.