London afternoon: Footsie eases into the red

5th Oct 2009 13:45

The Footsie dipped into the red over the lunch-time session but it was a very shallow dip, with leading shares mixed and mostly sticking close to overnight levels. Life insurer Aviva is the heaviest faller in the FTSE 100 after it confirmed it is to sell a minority stake in its Dutch insurance business Delta Lloyd through a float on Euronext in Amsterdam. No more details were released, but weekend reports suggested the life insurer would sell between 30-40% of Delta and value it at about £4bn.Elsewhere in the insurance sector, investors welcome reports that RSA has abandoned plans to raise $1bn (£614m) in a rights issue after scouring the markets for takeover targets and coming up blank.Admiral has launched its new car insurance operation in the US which will trade under the name of Elephant and will sell insurance to customers via telephone and internet. It will initially trade in Virginia only and start 'modestly', the group said.Miners feature prominently among the top performers, helped by bullish comment from Royal Bank of Scotland (RBS). RBS has upgraded Antofagasta from 'sell' to 'buy' while BHP Billiton, Rio Tinto and Vedanta are all moved up to 'buy' from 'hold'. RBS reiterated its 'hold' rating for Eurasian Natural Resources but has raised its price target from 670p to 850p. Xstrata is rated a 'buy' but with a higher price target of 1200p, versus 1050p previously.Lonmin defies the sector trend, heading lower along with energy stocks, which retreat in line with the lower oil price.Royal Bank of Scotland itself is higher despite a report it will finalise a £4bn share placing this week. The cash raised will reduce the cost of entry to the Asset Protection Scheme. Elsewhere in the banking sector Barclays is upgraded by UBS to 'neutral' from 'sell'.HSBC has sold its New York headquarters for $330m in cash and will lease back the office block for a year. The sale, to a company controlled by Israeli businessman Nochi Danker, should complete by the first quarter of 2010. Chief executive, Michael Geoghegan, told the Financial Times he's convinced there will be a second downturn in the coming months and that he plans to delay any rush to expand the bank.BAE Systems is higher. Reports today suggest the firm is prepared to settle the Serious Fraud Office's six-year investigation into allegations of bribery in Africa and Eastern Europe, but will not do so "at any cost".Supermarket giant Tesco is lower ahead of a trading update tomorrow, despite US broker Bernstein raising its price target for the stock from 440p to 480p. Sector peer Sainsbury, due to announce interims on Thursday is, like Tesco, expected to outperform by Bernstein; its price target has been nudged higher to 360p from 340p. Chemring moves ahead after saying it will supply the US Department of Defense with a range of military decoy flares in a five-year deal worth up to $804m (£502m). Soap manufacturer PZ Cussons is going well after it said it remains 'cautiously optimistic' for the full year despite uncertain economic conditions after seeing strong trading in its main market of Nigeria and in the UK. Kopane Diamond, which mines for the gemstones in Lesotho, has entered into a 60-day exclusivity agreement with a potential investor in its Liqhobong mine. Semiconductor wafers technology specialist IQE is buying rival gallium nitride materials supplier NanoGan for up to £3.6m, dependent on performance.Scottish semiconductors group Wolfson's sales continue at a level well below last year with third quarter revenue expected to come in at $35m though it is more optimistic over 2010 as new products come on stream.Diagnostics testing kit firm Immunodiagnostic Systems enjoyed a 56% jump in revenue during the six months to September and is confident about prospects.Shares in Supercart rolled higher after the shopping trolley firm said it expects to swing to a half year profit.