London midday: Shares tread water

14th May 2009 11:54

It is back to square one for London's blue-chips, with gains on banks and miners cancelled out by losses on oils and telecoms giant BT.Banks suffered some profit taking earlier in the week but are bouncing back, helped by a research note on the sector from Morgan Stanley. The US investment bank has raised its recommendation on Barclays from 'equal weight' to 'overweight' and raised its target price from 270p to 325p.Elsewhere in the sector Royal Bank of Scotland, Standard Chartered and Lloyds Banking all feature prominently among Footsie's best performers.Miners continue on their usual volatile path. Having opened weaker, most are now in credit, with silver miner Fresnillo and gold miner Randgold Resources joined in the advance by the two Khazaki mining companies, Kazakhmys and ENRC. Anglo American remains in the red, however, but Rio Tinto seems to have shaken off, for now, fears about a rights issue replacing the Chinalco cash injection, and is moderately firmer on hopes of BHP Billiton reviving its bid plans for the company.Oil companies fall back as the oil price continues to drift lower. Cairn Energy, Royal Dutch Shell and BP are the main fallers, along with oilfield services company Petrofac.The market was braced for bad news from BT but the results were worse than anticipated and the dividend cut more severe than predicted. The telecoms leviathan suffered a 40% slump in pre-tax profit during the four quarter, forcing the firm to slash its dividend and announce plans to axe another 15,000 jobs. Fourth quarter pre-tax profit plunged to £429m from £714m a year ago and by 21% for the full year to £2.08bn. Insurer Prudential called a 5% drop in insurance sales during the first quarter to £697m a "resilient" performance and boasted asset management net inflows of £2.7bn. Sales in Asia fell 11% versus the same time last year, but were roughly in line with the fourth quarter of 2008 at £333m. Brewing giant SABMiller posted a fall in pre-tax profits in the year to March 31 as beer drinkers began to feel the effects of the global financial crisis towards the end of the period. Pre-tax profit slipped to $2.96bn from $3.26bn even as higher pricing in some markets helped lift revenue to $25.3m from $23.8m. Engineering and construction group Balfour Beatty expects to make progress in 2009 after seeing strong trading in its divisions, helped by its exposure to public sector projects.Consumer electricals retailer Kesa said it will cut jobs and close some of its stores in Spain as it announced a 7.5% drop in total like-for-like sales. However, overall the company traded in line with its markets. Power provider National Grid reported a 3% drop in full-year pre-tax profit but said it has made a good start to the new year.A strong performance from its rail division helped engineer Invensys lift revenues and maintain profitability in the year to March 31. Profit before tax fell to £165m from £199m the previous year, even as revenue climbed to £2.28bn from £2.10bn. Travel firm Thomas Cook said it is on track to meet full year exceptions despite reporting a wider pre-tax loss in the six month ended March.Car rental company Avis said overall volumes were broadly in line with expectations, below the year before period, as poor demand continues, particularly in Spain. Broadcaster ITV said today it expects net television advertising revenue to fall 16% this month and 18% in June, worse than the 15% reported for the first quarter.The share price of ceramics firm Cookson is on the boil after the company said that after merely breaking even in the first two months the company has since been trading at a small profit and expects this trend to continue throughout the second quarter.Inter-dealer broker Tullett Prebon's shares are on the slide after it said revenue in the first four months of 2009 was down 6% on the same period of last year at constant exchange rates. .Car dealer Inchcape said first quarter trading was ahead of expectations, helped by strong performances from the UK and Singapore.Meatpacker Hilton Food said trading for the 16 weeks ended April 19 has been in line with management expectations.Property developer St. Modwen announced plans to raise £107.4m in a bid to reduce debt and lower gearing. The group set a price of 135p per share, representing a discount of 38.4% to the closing price on 13 May.SQS Software Quality Systems dropped after the software testing company said adjusted pre-tax profit for the six months ending 30 June will be about half of the level reported in 2008.Business publishing and events group Euromoney Institutional Investor fell into the red at the interim stage thanks to exceptional items. The company said trading 'may get worse before it gets better'.FTSE 100 - RisersBarclays (BARC) 258.50p +6.49%Invensys (ISYS) 210.50p +6.42%Fresnillo (FRES) 596.50p +5.58%Standard Chartered (STAN) 1,163.00p +5.06%FTSE 100 - FallersPetrofac Ltd (PFC) 590.00p -6.13%Inmarsat (ISAT) 510.50p -4.58%Cairn Energy (CNE) 2,288.00p -2.64%BT Group (BT.A) 92.10p -2.44%Royal Dutch Shell 'B' (RDSB) 1,602.00p -2.14%