London open: Flat start for FTSE 100

6th Jan 2011 08:32

The top share index is little changed in early dealings but a raft of trading updates from retail and other sectors has given traders plenty to ponder.Mother and baby retailer Mothercare today warned that it now expects full year underlying pre-tax profit to be below current market expectations after disappointing Christmas sales. UK like for like sales in the third quarter fell 5.8% as freezing temperatures kept would be shoppers at home. Toy sales were particularly affected, as were online sales as the retailer cut off Christmas orders early, amid adverse weather conditions, to make sure customers received their goods in time.Greetings card specialist Clinton Cards has also pointed to the negative impact of wintery weather in the run-up to Christmas, warning that pre-tax profits for the year to July 31 are likely to fall short of current market expectations. Like-for-like sales fell by 2% from the same period a year ago at its UK stores in the five weeks to 2 January. At its Irish operations (with 14 out of the group's 824 stores) like-for-like sales were down by 12.2%.However, it's not all doom and gloom in the retail sector. Wine merchant Majestic Wine raised a glass to Britons' refusal to let the winter snowfall prevent them celebrating Christmas after reporting strong sales over the festive period. Total UK store sales, excluding VAT, were up 6.4% for the nine weeks of Christmas trading from 2 November 2010 to 3 January 2011. Over the same period, like for like UK store sales growth, excluding VAT, was 3.7%. Uncertainty in the retail sector has prompted McBride, which makes toothpaste and other household items for supermarkets to sell under their own labels, to warn that its full-year performance could be at the lower end of its expectations. The shares have taken a sharp dive. Growth in Central and Eastern Europe has been driving revenues higher but the UK has been very competitive, McBride said. This, "combined with our previously announced time-lag in cost recovery, leads the board to expect that trading profit for the first half will be around £20m," the company said.There was further evidence of a newly confident airline industry Thursday as British Airways completed contracts with power systems developer Rolls-Royce, one of the FTSE 100's top risers today, for Trent 900 and Trent 1000 engines to power up to 61 new wide-body aircraft. The order was originally announced in September 2007 and is worth in excess of $5bn at list prices if all options are exercised. Recruitment giant Hays, another strong performer today, grew net fees by more than a fifth during its second quarter as rapid growth at the international business made up for a drab performance in the UK. Net fees on a like for like basis - organic growth at constant currency - was up 21% in the three months to 31 December, in line with expectations. The actual increase was 24%. Continental Europe & Rest of World led the way with a 37% surge, or 53% on an actual basis, followed by Asia Pacific, up 36%, or 33% actual. The UK & Ireland rose just 1%.Construction and engineering group Costain has returned to the table with what it terms "a significantly enhanced proposal" to take over contractor Mouchel. The new offer is on the basis of 0.5947 Costain shares for each Mouchel share, valuing each Mouchel share at about 135p.FTSE 100 - RisersARM Holdings (ARM) 531.50p +12.75%Randgold Resources Ltd. (RRS) 5,235.00p +2.85%Rolls-Royce Group (RR.) 666.50p +1.91%Vedanta Resources (VED) 2,525.00p +1.77%Rexam (REX) 344.70p +1.65%Pearson (PSON) 1,025.00p +1.59%Marks & Spencer Group (MKS) 380.40p +1.44%Xstrata (XTA) 1,519.50p +1.33%Amec (AMEC) 1,200.00p +1.27%Eurasian Natural Resources Corp. (ENRC) 1,092.00p +1.20%FTSE 100 - FallersIntertek Group (ITRK) 1,781.00p -1.11%Reckitt Benckiser Group (RB.) 3,537.00p -1.09%BT Group (BT.A) 184.30p -0.97%Royal Bank of Scotland Group (RBS) 40.58p -0.90%Scottish & Southern Energy (SSE) 1,234.00p -0.64%Shire Plc (SHP) 1,551.00p -0.64%Centrica (CNA) 333.60p -0.63%Associated British Foods (ABF) 1,143.00p -0.61%Petrofac Ltd. (PFC) 1,639.00p -0.61%Standard Life (SL.) 218.20p -0.59%FTSE 250 - RisersRegus (RGU) 95.55p +3.92%Taylor Wimpey (TW.) 33.75p +2.90%Salamander Energy (SMDR) 281.90p +2.36%Petropavlovsk (POG) 1,121.00p +2.19%ITE Group (ITE) 247.00p +2.02%Dunelm Group (DNLM) 540.00p +1.89%Barratt Developments (BDEV) 97.55p +1.83%Home Retail Group (HOME) 201.50p +1.82%Premier Oil (PMO) 2,059.00p +1.68%Ocado Group (OCDO) 203.00p +1.50%FTSE 250 - FallersMcbride (MCB) 168.60p -8.27%Mothercare (MTC) 562.50p -5.94%Halfords Group (HFD) 426.00p -3.18%St. Modwen Properties (SMP) 170.20p -2.13%Halma (HLMA) 352.50p -1.95%Stobart Group Ltd. (STOB) 141.60p -1.80%Hikma Pharmaceuticals (HIK) 851.50p -1.73%CSR (CSR) 371.60p -1.62%Caledonia Investments (CLDN) 1,900.00p -1.45%Devro (DVO) 251.50p -1.37%