London open: Retailers dip as consumer confidence dives

17th Nov 2011 09:07

After yesterday's shake-out on Wall Street, London's blue-chips are mostly lower, though trading updates have generated some bright spots.Centrica, which trades under the British Gas brand, is not one of the those bright spots, after it warned that full-year earnings will be a bit lower than the market is expecting, due to the unusually warm weather experienced in recent months. "Subject to weather conditions for the remainder of the year, we continue to expect growth in full year earnings, despite significantly lower margins in our downstream residential business than in 2010," the group said.The second half has been a mixed bag for packaging company Rexam, with out-performance by its Beverage Cans business more or less cancelled out by continued weakness on the Plastic Packaging business. The shares rose, however, as the company said that it considering chucking its Personal Care division overboard. The company also announced that its chairman, Sir Peter Ellwood is to retire from the company in February to be succeeded by ex-Pilkington boss, Stuart Chambers.Power grid operator National Grid said it is well placed to deliver another good year after posting a small improvement in underlying profit at the half-year stage. The board has approved an increase in the interim dividend to 13.93p per ordinary share, in line with its policy of targeting 8% dividend growth until March 2012.Outsourcing colossus Serco said the outcome for the current financial year should be in line with expectations, despite continuing headwinds in the UK and US. "While short-term headwinds remain, particularly those facing the US federal contracting industry, longer term developments in our markets and our strong positions are all encouraging factors. This underpins our confidence that the portfolio will sustain growth well into the future," said Serco's chief executive, Christopher Hyman.Engineering and project management services firm AMEC was another company saying trading is in line with expectations despite current macro-economic uncertainty. The oil & gas and mining sectors have been keeping the company busy, and the order book remains strong at £3.3bn at the end of October, up from £3.1bn a year earlier but down from £3.4bn at the end of June 2011.SABMiller, the huge brewing company behind brands including Grolsch and Foster's, has joined the chorus of companies griping about rising raw material costs, as its margins felt the squeeze in the first half of its financial year.Earnings before interest tax and amortisation (EBITA) rose 6% at constant currency prices in the six months to the end of September, although EBITA margin reduced by 10 basis points (bps), or one-tenth of a percentage point, to 17.2% as raw material costs began to bite.Retailers are out of favour in the wake of a sharp fall in the Nationwide building society's consumer confidence index for the month of October.The main sentiment index fell 9 points from the previous month's level to 36, its lowest level since May 2004.Fashion chain French Connection added to the high street gloom by issuing a profits warning. FTSE 100 - RisersRexam (REX) 341.80p +5.14%Serco Group (SRP) 510.00p +1.80%National Grid (NG.) 636.50p +1.60%Glencore International (GLEN) 410.35p +1.30%British Sky Broadcasting Group (BSY) 718.50p +0.35%Diageo (DGE) 1,323.00p +0.08%International Consolidated Airlines Group SA (IAG) 143.50p 0.00%Reed Elsevier (REL) 523.50p -0.19%Capita Group (CPI) 675.00p -0.22%WPP (WPP) 662.50p -0.23%FTSE 100 - FallersCarnival (CCL) 2,080.00p -3.03%British Land Co (BLND) 480.00p -2.36%Weir Group (WEIR) 1,866.00p -2.35%Schroders (SDR) 1,317.00p -2.23%Man Group (EMG) 140.00p -2.23%Vedanta Resources (VED) 1,068.00p -1.93%Xstrata (XTA) 978.60p -1.89%Fresnillo (FRES) 1,834.00p -1.87%ITV (ITV) 65.75p -1.87%Johnson Matthey (JMAT) 1,849.00p -1.86%FTSE 250 - RisersBTG (BGC) 301.20p +4.87%Lamprell (LAM) 270.40p +2.46%Phoenix Group Holdings (DI) (PHNX) 487.90p +1.65%SThree (STHR) 235.70p +1.55%FTSE 250 - FallersPace (PIC) 50.00p -17.08%Premier Foods (PFD) 4.40p -7.37%Ferrexpo (FXPO) 287.50p -4.20%Supergroup (SGP) 597.50p -4.09%--jh