London open: Bulls charge ahead after Intel optimism

14th Oct 2009 08:44

The bulls are in full charge mode this morning after forecast-busting third quarter results from Intel raised optimism for a strong US third quarter earnings season and eventual US economic recovery.Intel, the world's largest computer chipmaker, reported an 8.3% drop in net income for the three months to $1.9bn, or 33c a share, but that easily trumped the 28c predicted by analysts. "Intel's strong third-quarter results underscore that computing is essential to people's lives, proving the importance of technology innovation in leading an economic recovery," said Intel's chief executive Paul Otellini.Over here, miner Rio Tinto has been busy. It set a new record for iron ore production in its third quarter with shipments to China still high despite the row over the arrest and detainment of four its employees on spying charges. "We are seeing early signs of a recovery in some of our key markets, although we remain cautious about the near term outlook," chief executive Tom Albanese said.Rio is one of the best performers this morning alongside most of its peers in the mining sector. Kazakhmys and Vedanta are going especially well.Fashion group Burberry is also in demand after a better-than-expected 5% rise in second quarter sales thanks to a good performance in Europe and Asia. Total sales rose to £343m compared with £328m last time, though sales were down 5% at constant exchange rates.But Pub group Punch Taverns slumped into an annual loss of over £400m as it took a £663m charge for write-downs on the value of its pub estate. Even before the write-down, underlying profits for the year to 22 August fell from £262m to £160m on revenues down from £1.56bn to £1.44bn. After one-offs there was a loss of £405m against a loss of £80m.Defence giant BAE Systems has traded in line with expectations since its half year results were published at the end of July, it revealed Wednesday. It also said it would deal with any issues that arise from the Serious Fraud Office's (SFO) investigations into allegations of bribery " at the appropriate time and, if necessary, in court". A weaker sterling will benefit the full-year numbers and operating cash inflow in the second half year should be stronger than in the first, the weapons group added. Information services company Experian reported a 1% rise in half year sales and said it remains on track to at least maintain margins, grow profits at constant currency and deliver strong cash flow conversion. Cardboard and paper supplier DS Smith said first half pre-tax profits will be 'substantially' ahead of expectations, although lower than last year's levels.Online and mail order retailer N Brown upped its interim dividend by over 50% as strong sales over the internet and a better bad debt picture lifted underlying profits by 13%. Drug developer Phytopharm powered forward after results from two phase two trials showed its Cogane may be a "highly encouraging novel potential treatment for Parkinson's Disease".