London close: Third day of gains

2nd Feb 2010 16:39

A strong start in the US helped London rise for the third day in a row and finish at its highest in over a week, with commodity plays the pick of the bunch.Investors piled into miners as metal prices took off and brokers backed a further recovery in share prices.Eurasian Natural Resources (ENRC), Kazakhmys and Rio Tinto, Lonmin, Xstrata and Anglo American were out in front.Rio is lifted to 'buy' from 'hold' at Citgroup after upgrades to iron ore prices, while Deutsche Bank, SocGen and Citi advise clients to buy Xstrata after the miner's fourth quarter trading update.SocGen upgraded Anglo to 'buy' from 'hold' and raised its target to £30 from £29 on valuation grounds.Cairn Energy and Shell were in demand as the cost of oil traded near $76 a barrel in New York, although BP took a pounding after its fourth quarter numbers. Chief executive Tony Hayward described it as a 'very good' year for the oil giant, with a sharp increase in fourth quarter profit, but they came in below analysts' forecasts and the shares were punished. Underlying replacement cost profit in the fourth quarter was up 70% on a year earlier at $4.4bn. Defensive issues joined BP in the red. Severn Trent, United Utilities and National Grid were dumped in favour of growth plays.Cigarette manufacturer Imperial Tobacco has made a strong start to the year, winning market share in growing markets such as Africa, the Middle East and Asia Pacific. The firm said its Davidoff brand has grown share in its top five markets and that West and JPS have also performed well.Market share gains and growing demand for smartphones kept chip designer Arm ahead of its rivals at the end of 2009, though sales and profits were still lower in the quarter. Fourth quarter revenues were $140m, down 6% on 2008, compared with an industry fall of about 15%. Sterling revenues were £85.2m, down 10% year-on-year.Cable & Wireless confirmed it will pay a dividend of 9.5p this year and a similar amount the following year in its final update before it splits into two in March. Fashion retailer New Look has outlined its plans to float on the London Stock Exchange as it seeks to fund continued expansion. It will seek to raise about £650m from a primary offering 'to be used to de-leverage the balance sheet so as to provide New Look with the flexibility to fund its continued growth.' Dairy Crest said pre-tax profit for the nine months ended 31 December 2009 is slightly ahead of company expectations, helped by a strong performance in the last three months. Engineering support services group Babcock remains on track for 'another year of excellent progress'. The group said the long term growth prospects of its main markets 'remain excellent' while the order book remains solid at around £6bn.Defence industry supplier Ultra Electronics has won a contract for nuclear sensors from British Energy. The contract is worth more than £20m, and is for the long term supply and management of neutron flux detectors to a number of reactors in the British Energy fleet.FTSE 100 - RisersEurasian Natural Resources (ENRC) 977.00p +4.60%Amec (AMEC) 785.50p +4.52%Cairn Energy (CNE) 339.20p +4.14%Kazakhmys (KAZ) 1,331.00p +3.90%Royal Bank of Scotland Group (RBS) 36.15p +3.70%Experian Group (EXPN) 612.50p +3.55%Fresnillo (FRES) 724.50p +3.50%Xstrata (XTA) 1,096.00p +3.40%British Land Co (BLND) 457.00p +3.39%Rio Tinto (RIO) 3,291.00p +3.39%FTSE 100 - FallersBP (BP.) 572.00p -3.80%Severn Trent (SVT) 1,148.00p -1.88%Legal & General Group (LGEN) 77.45p -1.71%United Utilities Group (UU.) 542.50p -1.63%BAE Systems (BA.) 347.10p -1.31%British Sky Broadcasting Group (BSY) 534.00p -0.93%Kingfisher (KGF) 215.00p -0.74%Shire Plc (SHP) 1,264.00p -0.71%Man Group (EMG) 242.50p -0.70%National Grid (NG.) 639.00p -0.70%FTSE 250 - RisersParagon Group Of Companies (PAG) 152.90p +9.14%St. Modwen Properties (SMP) 204.50p +7.24%BSS Group (BTSM) 275.00p +7.21%Ferrexpo (FXPO) 219.90p +7.16%JKX Oil & Gas (JKX) 289.20p +6.36%Morgan Crucible (MGCR) 173.10p +6.00%Cranswick (CWK) 800.00p +5.96%Dimension Data Holdings (DDT) 82.55p +5.70%Babcock International Group (BAB) 592.00p +5.62%ARM Holdings (ARM) 200.30p +5.53%FTSE 250 - FallersNorthumbrian Water Group (NWG) 281.30p -2.66%Shanks Group (SKS) 124.00p -2.29%Aveva Group (AVV) 1,074.00p -2.01%Pennon Group (PNN) 529.50p -1.94%Evolution Group (EVG) 122.50p -1.61%PV Crystalox Solar (PVCS) 54.50p -1.09%Dexion Absolute GBP Shares (DAB) 145.90p -1.08%Brit Insurance Holdings NV (BRE) 187.10p -0.85%UK Commercial Property Trust (UKCM) 80.00p -0.62%Dechra Pharmaceuticals (DPH) 502.00p -0.59%