London midday: Footsie jumps after Spanish auction, ZEW survey

13th Dec 2011 11:46

The Footsie has bounced back into positive territory after a strong Spanish bond auction and a better-than-expected German confidence survey lifted sentiment across the continent. London's blue chip index was up some 39 points at 5,467 by midday, a big swing from the intraday low of 5,416 it sank to in early trading.SPAIN ISSUES €4.94BN, GERMAN CONFIDENCE IMPROVESThe Spanish Treasury has this morning auctioned €4.94bn in short-term debt. The majority of which, €3.44bn worth, had a maturity of 12 months and was placed at a yield of 4.05%, versus 5.02% the last time around. The bid-to-cover came in at 3.1 times the supply on offer, compared to 2.1 times seen at the last auction.The bid-to-cover on the 18-month issue came in at 5.0, down somewhat from 6.0 the last time. Yields came off, retreating to 4.226% from 5.159% before. Meanwhile, Germany's economic sentiment index reached a reading of -53.8 points in December compared to -55.2 in the previous month, according to the latest data from the ZEW Institute. The market consensus was looking for a reading of -55.0. This 1.4 point increase marks the end of nine consecutive declining months, however this important leading indicator is far from its historic average of 24.6. ZEW president Wolfgang Franz said "the economic sentiment for Germany seems to have bottomed out. Apparently, the financial market experts expect the economic activity to slow down, but not to plunge during the next six months." In domestic news, price rises continued to slow in November, with the Consumer Prices Index (CPI) coming in at 4.8%, according to figures from the Office for National Statistics. The ONS said slower increases in price of food, clothing and transport helped push the CPI rate lower compared to the year before. The Retail Prices Index, which includes housing costs and is often used in wage negotiations, fell to 5.2% from 5.4% in October. The Royal Institute of Chartered Surveyors' (RICS) house price balance for the month of November has risen moderately, to -17 from -24 the month before. That is the highest level since July 2010. Market consensus had been expecting a slight deterioration to -25. PETROFAC AND MINERS PROVIDE A LIFTOilfield services firm Petrofac was at the top of the riser list, gaining nearly 5%. The company expects to deliver like-for-like (LFL) net profit growth in 2011 of at least 20%, the company said. On the basis of awards announced in the year to date, the order backlog is expected to be in the region of $10.6bn at 31 December 2011, down from $11.7bn at the end of 2010. Meanwhile, FTSE 100 mining heavyweights Vedanta Resources, Kazakhmys and ENRC were performing strongly on the back of some confident remarks from 'down under'. Australia's Bureau of Resources and Energy Economics (BREE) upped its guidance for iron ore and thermal coal exports to reflect "recent expansions to mine and infrastructure capacity", according to BREE executive director and chief economist Quentin Grafton. Reuters also cited growing demand from China as a reason for the raised forecasts.Results from Costa Coffee shop owner Whitbread have left a sour taste, with evidence that sales growth is running out of steam. For the group as a whole, third quarter sales at outlets which have been open longer than a year rose just 2.4% year-on-year compared to 3.3% growth in the first half. ON THE UP - DOMINO PRINTING, IMAGINATION TECH AND CARPETRIGHT FTSE 250 printing technologies firm Domino Printing Sciences reported its best ever full year results following a strong global performance and the introduction of new products. Underlying pre-tax profits hit a record £59.5m, up 9% from the year before. Shares jumped 16.6%.Mobile phone and computer chip maker Imagination Technologies wasn't far behind after reporting a 52% surge in adjusted pre-tax profit, with strong licensing and continued royalty revenue growth. Flooring specialist Carpetright saw a 3.9% drop in revenue in the half year to 29 October, contributing to a significant fall in underlying profit before tax. However, the shares surged higher as the pre-tax profit of £1.4m was ahead of many brokers' expectations. Panmure Gordon upgraded its rating on Carpetright from sell to hold.House-builders were generally out of favour, after UBS issued a downbeat assessment on the sector outlook. "The macro environment is likely to become less supportive into 2012, with no GDP growth (UBSE -0.1%) and banks facing increasingly difficult funding markets," the Swiss broker said. Sector peers Bovis Homes, Bellway and Travis Perkins were among the fallers on the FTSE 250.BCFTSE 100 - RisersPetrofac Ltd. (PFC) 1,437.00p +4.66%Essar Energy (ESSR) 212.00p +3.97%Man Group (EMG) 135.10p +3.76%Vedanta Resources (VED) 1,102.00p +3.47%Lloyds Banking Group (LLOY) 25.14p +2.91%Kazakhmys (KAZ) 901.50p +2.44%ITV (ITV) 63.10p +2.35%Weir Group (WEIR) 1,929.00p +1.90%Resolution Ltd. (RSL) 252.20p +1.90%Eurasian Natural Resources Corp. (ENRC) 646.00p +1.81%FTSE 100 - FallersWhitbread (WTB) 1,503.00p -4.63%Burberry Group (BRBY) 1,196.00p -1.73%InterContinental Hotels Group (IHG) 1,088.00p -1.54%Kingfisher (KGF) 244.90p -1.29%Standard Chartered (STAN) 1,408.00p -0.81%Ashmore Group (ASHM) 325.20p -0.70%Tesco (TSCO) 389.05p -0.63%Prudential (PRU) 620.50p -0.56%Smiths Group (SMIN) 903.50p -0.06%Unilever (ULVR) 2,115.00p -0.05%FTSE 250 - RisersDomino Printing Sciences (DNO) 509.00p +16.61%Imagination Technologies Group (IMG) 495.00p +13.27%Carpetright (CPR) 430.60p +8.90%Go-Ahead Group (GOG) 1,305.00p +5.93%Perform Group (PER) 211.60p +4.75%New World Resources A Shares (NWR) 430.70p +4.39%Supergroup (SGP) 517.00p +4.36%Redrow (RDW) 114.60p +4.18%Ferrexpo (FXPO) 277.70p +4.09%African Barrick Gold (ABG) 490.00p +3.75%FTSE 250 - FallersTalvivaara Mining Company (TALV) 223.40p -2.83%Pace (PIC) 65.65p -2.52%Moneysupermarket.com Group (MONY) 101.50p -2.22%F&C Asset Management (FCAM) 64.10p -2.21%Travis Perkins (TPK) 799.50p -1.84%Northgate (NTG) 213.00p -1.75%Bovis Homes Group (BVS) 446.50p -1.43%JD Sports Fashion (JD.) 641.00p -1.38%Hays (HAS) 61.40p -1.29%Bellway (BWY) 726.00p -1.22%