London close: Stocks finish higher after volatile session

28th Feb 2012 17:08

- Ireland to hold referendum on fiscal compact.- US economic data comes in mixed.- GKN leads fallers after full-year results.The Footsie finished just 0.2 percent higher on Tuesday as losses over lunchtime were pared in the afternoon with stocks seesawing on some mixed economic data in the US. Strength in the mining sector boosted London's blue chip index today, while GKN, CRH and Serco were leading the downside after their full-year results. Meanwhile, markets across Europe will be looking ahead of tomorrow's long-term refinancing operation from the European Central Bank (ECB). US durable goods orders for the month of January came in below expectations, while the Conference Board's latest reading on consumer confidence the Richmond Fed's manufacturing index for the month of February both beat forecasts.Late in the day, it was announced that Ireland will hold a referendum on the Fiscal Compact treaty agreed with other European Union members last month. According to Prime Minister Enda Kenny, "the Irish people will be asked for their authorisation, in a referendum, to ratify the European Stability Treaty. I strongly believe that is very much in Ireland's national interest that this treaty be approved, as doing so will build on the steady progress the country has made in the past year," he said.GERMANY APPROVES GREEK BAILOUT The German parliament approved the second €130bn Greek bailout package on Monday afternoon. It was passed by a wide majority with 496 votes in favour and only 90 opposed, although German Chancellor Angela Merkel's coalition fell short of obtaining the so-called "Chancellor's majority." Merkel repeated her opposition to boosting the European Financial Stability Facility (EFSF) and European Stability Mechanism's (ESM's) capacity. Today, the ECB announced that it has temporarily suspended the right to use Greek bonds as collateral in its Eurosystem monetary policy operations. The monetary authority has explained that the decision is based on the Hellenic Republic's credit rating and the recent private sector involvement offer. The decision by the ECB comes after Standard & Poor's (last night) cut Greece's 'CC' long-term and 'C' short-term sovereign credit ratings to 'selective default' due to the passing of the collective action clauses (CACs) that bind all bondholders to take a 'voluntary' haircut of 53.5% on Greek debt holdings. GKN DROPS 4.4% AFTER FULL-YEAR RESULTSAutomotive and aerospace engineer GKN was the heavy faller on the FTSE 100 despite hiking its total dividend by a fifth after seeing double-digit growth in both sales and profits in 2011. Analysts at Digital Look have highlighted the fact that, prior to today's announcement, the stock had risen by around a third since mid-December. "Today's results have just taken some steam off its recent strong run", notes one analyst.Another possible catalyst for today's selling may be the remarks from the company's chief executive officer regarding the technical "challenges" which Airbus's A350 poses. After falling sharply early on, Whitbread pared losses late on. The group reported this morning that both reported sales and like-for-like (LFL) sales slowed down in the 11 weeks to February 16th, as strong growth at its Costa coffee shop chain was met with a more subdued performance at its hotels and restaurants. Outsourcing giant Serco was also out of favour despite saying 2011 was a year of "solid operational performance and contract awards across the portfolio", reflected in a 7.4% increase in revenue to £4,646m from £4,327m in 2011. Irish building materials group CRH fell despite reporting profits that beat consensus estimates and its own forecasts in 2011. Having indicated to the market back in November that profit before tax and impairment charges for 2011 would fall somewhere between €678m and €708m, the final figure was €743m, well ahead of market consensus of €656m. Leading the upside was Essar Energy, which was rebounding after seeing a steep fall in its share price yesterday as its reported a sharp drop in profits in the 12 months ended December 31st. Miners were also performing well, with Evraz, Fresnillo, Antofagasta, Vedanta Resources and Xstrata tracking metals prices higher.PERSIMMON BOOSTS HOUSE-BUILDING ON THE FTSE 250 Home construction stocks had a strong day today, with Persimmon leading the way, jumping 13% on news of a cash return worth £1.9bn over the next nine and a half years, something that Peel Hunt has called a 'game-changer'. Meanwhile, underlying pre-tax profits increased 55% to £148.1m in 2011, higher than market expectations of £141.1m. Sector peers Barratt Development and Bellway were performing well, while Taylor Wimpey was making hefty gains of nearly 7% ahead of its full-year results tomorrow. Heading the other way was AZ Electronic Materials. The group, which produces speciality chemical materials to technological manufacturers, saw strong growth in profits in 2011, but warned that it expects "the more challenging trading conditions that we experienced towards the end of 2011 to continue into the first half of 2012." BCFTSE 100 - RisersEssar Energy (ESSR) 113.40p +5.39%Evraz (EVR) 417.10p +3.58%Fresnillo (FRES) 1,906.00p +2.58%WPP (WPP) 815.00p +2.45%Antofagasta (ANTO) 1,364.00p +1.79%Admiral Group (ADM) 1,081.00p +1.79%Sage Group (SGE) 312.40p +1.73%Vedanta Resources (VED) 1,502.00p +1.69%ITV (ITV) 80.50p +1.64%Capita (CPI) 751.00p +1.56%FTSE 100 - FallersGKN (GKN) 222.20p -4.43%Hargreaves Lansdown (HL.) 439.50p -2.18%BAE Systems (BA.) 309.70p -1.99%CRH (CRH) 1,342.00p -1.90%Tullow Oil (TLW) 1,508.00p -1.50%Serco Group (SRP) 548.00p -1.26%Smith & Nephew (SN.) 618.00p -1.20%Weir Group (WEIR) 2,205.00p -1.12%Aggreko (AGK) 2,203.00p -1.08%BT Group (BT.A) 215.90p -0.87%FTSE 250 - RisersPersimmon (PSN) 706.50p +12.68%SDL (SDL) 707.50p +7.28%Moneysupermarket.com Group (MONY) 129.50p +6.50%Provident Financial (PFG) 1,140.00p +6.24%Taylor Wimpey (TW.) 52.65p +6.00%Barratt Developments (BDEV) 149.20p +5.52%Laird (LRD) 175.70p +3.90%Bellway (BWY) 818.50p +3.54%Dixons Retail (DXNS) 14.93p +2.97%Grainger (GRI) 110.90p +2.97%FTSE 250 - FallersAZ Electronic Materials SA (DI) (AZEM) 288.80p -7.32%Euromoney Institutional Investor (ERM) 722.50p -5.06%Elementis (ELM) 158.30p -4.58%Ocado Group (OCDO) 95.30p -4.41%Rank Group (RNK) 139.00p -4.20%Interserve (IRV) 292.00p -3.95%Computacenter (CCC) 390.30p -3.03%Heritage Oil (HOIL) 183.50p -2.39%UBM (UBM) 587.50p -2.33%Supergroup (SGP) 552.50p -2.21%FTSE TechMARK - RisersPromethean World (PRW) 70.50p +7.22%AEA Technology Group (AAT) 0.31p +5.08%Ricardo (RCDO) 380.00p +4.11%Oxford Biomedica (OXB) 3.25p +3.17%Corin Group (CRG) 53.00p +2.42%Wolfson Microelectronics (WLF) 185.00p +2.21%BATM Advanced Communications Ltd. (BVC) 17.62p +2.17%Psion (PON) 49.00p +1.55%Dialight (DIA) 870.00p +1.46%E2V Technologies (E2V) 141.38p +1.16%FTSE TechMARK - FallersVernalis (VER) 22.88p -7.11%Microgen (MCGN) 140.00p -5.41%Emblaze Ltd. (BLZ) 45.00p -5.26%Anite (AIE) 108.50p -2.91%Kewill (KWL) 71.75p -2.71%Asterand (ATD) 5.75p -2.13%Xaar (XAR) 257.00p -1.91%Hiwave Technologies (HIW) 2.60p -1.89%RM (RM.) 81.25p -1.81%Ark Therapeutics Group (AKT) 3.45p -1.43%