London open: Stocks flat on 'fiscal cliff' uncertainty

20th Dec 2012 08:33

The FTSE 100 was trading little changed on Thursday morning, taking a pause after coming close to its 52-week high the day before, with US 'fiscal cliff' concerns acting as a drag on sentiment."In scenes reminiscent of the debt ceiling debacle of 2011 US markets slid back last night as the impasse in the fiscal cliff talks played out along partylines, while ratings agency Fitch hinted at the risk of a ratings cut if the current impasse continued," said market analyst Michael Hewson from CMC Markets.Fitch said yesterday that the Eurozone crisis and US fiscal cliff threaten the sovereign ratings on seven of the 10 largest world economies and said it would come to a decision on the matter in 2013. Hewson added: "The recent rally has all the hallmarks of looking a little stretched in a classic 'buy the rumour; sell the fact' kind of way as the deadline approaches for a solution to the fiscal cliff. This suggests any further upside could well be limited, especially if politicians look as if they could leave a resolution to the period between Christmas and New Year."Last night, the Bank of Japan added an extra 10tn yen to the size of its asset purchase programme, a move widely speculated following the weekend's vote to elect pro-stimulus Shinzo Abe as the country's incoming Prime Minister. FTSE 100: Weir in demand after acquisitionEngineering solutions group Weir rose after announcing that it is to buy pressure control rental equipment firm Mathena for £148m as it attempts to up its exposure to the fast-growing shale oil and gas market.Outsourcing giant Serco gained after saying that it is on track to meet expectations for 2012 as it announced the sale of two operations at a loss. The firm said it expected to deliver a year of strong total revenue growth, including good organic growth.Distribution and outsourcing firm Bunzl extended losses following yesterday's pre-close trading update. JP Morgan Cazenove and UBS both cut their target prices for the stock this morning.Defence and aerospace group BAE Systems rebounded this morning following yesterday's admission that it is struggling to agree on a price for the supply of 72 Typhoon aircraft with Saudi Arabia. The company said that if it cannot come to an agreement, it would reduce its full-year underlying earnings per share by around three pence per share.FTSE 250: Lancashire and Amlin in the redInsurance outfit Lancashire Holdings fell after estimating the impact Hurricane Sandy on the business will be in the region of $40-60m. Sector peer Amlin put its losses from the US superstorm at £145m, most of which comes from reinsurance claims.Construction firm Balfour Beatty gained after saying its half-owned Hong Kong builder, Gammon Construction, had won a contract worth £270m.Transport group Go-Ahead was higher after saying that it has compensated London Midland customers with £7m of benefits after they were disrupted by cancellations and delays last year.FTSE 100 - RisersGKN (GKN) 231.50p +1.94%Weir Group (WEIR) 1,844.00p +1.77%Aberdeen Asset Management (ADN) 363.70p +1.48%CRH (CRH) 1,241.00p +1.39%Aggreko (AGK) 1,723.00p +1.35%Wood Group (John) (WG.) 749.50p +1.28%InterContinental Hotels Group (IHG) 1,674.00p +0.90%British American Tobacco (BATS) 3,121.00p +0.84%Compass Group (CPG) 740.00p +0.82%Rio Tinto (RIO) 3,533.00p +0.76%FTSE 100 - FallersReckitt Benckiser Group (RB.) 3,921.00p -1.11%Fresnillo (FRES) 1,893.00p -0.94%Sage Group (SGE) 291.80p -0.92%Meggitt (MGGT) 391.30p -0.91%Bunzl (BNZL) 1,011.00p -0.88%G4S (GFS) 258.60p -0.84%United Utilities Group (UU.) 682.50p -0.80%Smith & Nephew (SN.) 680.00p -0.80%Burberry Group (BRBY) 1,240.00p -0.72%RSA Insurance Group (RSA) 125.90p -0.71%FTSE 250 - RisersVesuvius (VSVS) 336.30p +3.80%Barr (A.G.) (BAG) 500.00p +1.79%Perform Group (PER) 376.00p +1.62%BH Macro Ltd. EUR Shares (BHME) € 19.25 +1.58%Raven Russia Ltd (RUS) 63.45p +1.52%William Hill (WMH) 355.70p +1.48%London Stock Exchange Group (LSE) 1,120.00p +1.27%Stobart Group Ltd. (STOB) 99.65p +1.17%Petropavlovsk (POG) 366.00p +1.16%BH Macro Ltd. USD Shares (BHMU) 18.9 +1.07%FTSE 250 - FallersImagination Technologies Group (IMG) 405.60p -2.27%African Barrick Gold (ABG) 433.20p -2.08%Computacenter (CCC) 415.10p -1.73%Dignity (DTY) 1,057.00p -1.58%FirstGroup (FGP) 202.00p -1.32%IP Group (IPO) 111.10p -1.24%Dixons Retail (DXNS) 29.46p -1.14%Euromoney Institutional Investor (ERM) 829.50p -1.13%New World Resources A Shares (NWR) 305.30p -1.04%National Express Group (NEX) 201.50p -0.98%BC