London afternoon: Weak Wall St. undermines Footsie

7th Oct 2009 14:48

A soft opening by Wall Street prompted London's blue chips to take a step back, though plenty of firm features are still to be found.Supermarket Sainsbury's is off a few points after a 4.6% rise in like-for-like sales excluding fuel in the quarter to 3 October came in lower than expected. Excluding the impact of the VAT cut, like-for-like sales in the quarter, the second of the company's financial year, were up by 5.4%, marginally below the 5.5% level predicted by Numis Securities.Tesco and Morrisons, both weakened on the comments from Sainsbury boss Justin King who warned that he expects market growth to slow in the coming months due to reduced inflation.Also on the slide is insurer Admiral which is trading ex-dividend today, and hip replacement firm Smith & Nephew, which gets clobbered by a UBS downgrade to 'hold' from 'buy'..Intercontinental Hotels is one of the best risers after an upgrade from Citigroup to 'buy' from 'hold'. A new higher price target from Panmure Gordon of 910p also helped. The broker said that there were early signs of a recovery in the business travel market and it is hopeful over the relaunch of the Holiday Inn brand. Sausages and pork products supplier Cranswick said sales were strongly ahead at the interim stage, helped by a contribution from the recently acquired Bowes of Norfolk. Sales in the six months to 30 September rose by 19% from a year earlier, with 7% attributable to the contribution from Bowes, Cranwsick, one of whose main customers is Sainsbury's, said.White collar recruiter Michael Page made a third quarter operating profit and noted 'increasing degrees of stabilisation across our regions' in the last three months. Its Asia Pacific and Americas regions both recorded sequential growth.Defence outfit Cobham has won two orders from global security firm Northrop Grumman for digital vehicle intercom systems. The orders are worth $40m and are for the ongoing provision of Cobham's ROVIS (AN/VIC-3) digital intercom systems to the US army.Struggling Irish airline Aer Lingus is to cut a further 676 jobs as part of a swingeing cost cutting programme designed to reduce operating costs by €97m by the end of 2011. The job cuts are in addition to 100 staff on fixed term contracts who will leave at the end of the year. The shares are up on hopes Ryanair will make a third bid suggested analysts.With expensive home improvements low on most householders' list of priorities, luxury wallpaper and fabrics group Walker Greenbank posted a sharp drop in profits as revenues fell. Investors took heart, however, from chairman Terry Stannard's assertion that sales trends appear to be improving.Chocolate maker and retailer Thorntons had a solid three months to end September with sales up by 2.3% to £46.8m despite a big customer going under.Traders who took a punt on online bookmaker Sportingbet's results were rewarded when the company announced a surge in annual pre-tax profit after strong demand from Europe. The bookie, which has reinstated dividend payments, said the new financial year has started well.Shares in Novera jumped after the renewable energy group rejected a £90.5m offer from Infinis Energy, its largest shareholder, saying it 'significantly' undervalues the group. Private-equity backed Infinis Energy said it would pay 62.5p per share in cash for all remaining Novera shares it doesn't already own.Housebuilder and business park developer Artisan fell into losses in the year to June 30 as turnover slumped amid a sharp slowdown in the commercial and residential property sector. Internet telephony company Vyke Communications, which issued a profit warning at the end of September, has secured a £10m line of credit from GEM Global Yield Fund. The fund has agreed to take discounted shares in lieu of cash should Vyke draw on the credit facilities.