London afternoon: Stocks stay strong

26th Jan 2011 15:41

Shares have maintained their earlier buoyancy after a decent start on Wall Street. Company updates have been well-received here.BG Group is going strong after yet another discovery in the Santos Basin offshore Brazil. The latest strike is at Carioca North-East, located in a water depth of 2,151m, approximately 275km off the coast of São Paulo state. BG has a 30% stake.Accountancy software group Sage is another riser after its first quarter was in line with expectations flagged at last month's full-year numbers, keeping up the momentum in revenue growth seen in the second half. Heritage Oil has uncovered the largest gas field to be discovered in Iraq for more than 30 years, but the news took the market by surprise as the field had been expected to contain oil rather than gas. Shares fell 17% in early trading despite the significant find, with broker Panmure Gordon saying that "there is likely to be some disappointment for many of the more optimistic followers who had hoped that the well would prove up significant new oil reserves."However, elsewhere in the FTSE 250, precision engineer Renishaw is posting double-digit gains after it posted a sharp rise in half year pre-tax profit and upped its dividend following a surge in demand from Asia and metrology products. Its FTSE 100-listed fellow engineers Weir and IMI are also higher.Water supplier United Utilities has been trading in line with expectations since October, with regulated revenue slightly higher than anticipated, though it will tail off in the second half. Newsagent WH Smith's high street stores were hit by tough trading conditions and the winter freeze, but profits met forecasts and gross margin is ahead of plan. In what the newspaper, books and stationery retailer called a "resilient" performance, total sales for the 21 weeks to 22 January fell 4% and were down 5% on a like for like basis. A confident Cookson has forecast earnings growth of at least 10% for the next three years with dividends increasing in step. For the year to December just ended, the ceramics and electronics specialist expects revenue of around £2.5bn and trading profit of around £250m, adding that the group's performance in the current year, 2011, should be "well ahead of 2010". Final quarter sales at soft drinks group AG Barr, best known for its Irn Bru and Tizer brands, is expected to be around 5% ahead of the previous year after a strong performance from its core brands. Full year like for like growth is expected to be around 10%, the group said in Wednesday's trading update.