London open: Stocks flat with political uncertainty in focus

8th May 2012 08:40

- Greek and French elections raise concerns- Aviva up after CEO departure- Tullow rises after further oil find in KenyaAfter a long weekend, London's blue chips opened broadly flat on Tuesday morning with political concerns in Europe weighing on sentiment.Antonis Samaras from Greece's biggest party, Conservative New Democracy, has failed to form a new government after elections at the weekend. Alexis Tsipras from the left-wing Syriza party is now given the task of forming a new government and is expected to reject the tough austerity measures agreed as part of the bailout."Greece's troubles will worsen if the job of forming a new government drags out and forces another round of elections as they will run out of money in June if there is no government in place to negotiate the next tranche of the bailout, which will include another €11bn of cuts over the next two years," said analyst Craig Erlam from Alpari.Meanwhile, France elected anti-austerity Francois Hollande as its new President on Sunday, the country's first Socialist President in nearly two decades. He is looking to renegotiate the 'Fiscal Compact' and is thought to have begun discussions with German leader Angela Merkel. "A growth pact complementary to or merged with the fiscal pact seems very likely," said analysts at Barclays Capital."Together with the risks associated with the Greek situation and tensions in the Spanish banking sector, a new strategy may also need to include additional steps fostering political and fiscal integration in the euro area and a common approach for bank restructuring and resolution," they said.FTSE 100: Aviva & Tullow lead the riseInsurance group Aviva was performing strongly in early trading after announced that its CEO Andrew Moss has quit with immediate effect after the majority of its shareholders last week voted against the remuneration report.Tullow Oil jumped after it discovered further oil in the first exploration well at one of its Kenyan projects, increasing its potential 'significantly'. Following an announcement in March that the well had encountered in excess of 20m of net oil pay, the well was then deepened from 1,041m to 1,515m and a total pay count greater than 100m has now been discovered. Mining group ENRC was in demand after denying a possible spin-off of its operations outside Kazakhstan. There were press reports over the weekend of ENRC demerging its interests in the Democratic Republic of Congo, in addition to its coal mines in Mozambique and iron ore operations in Brazil. Other mining stocks however were in the red, with Randgold Resources, Polymetal, Vedanta and Xstrata among the worst performers early on.FTSE 250: Morgan Crucible slips after slow startIndustrial materials maker Morgan Crucible stuck to its full-year expectations despite a slower start to the year than it forecast. The firm said revenue in the first four months of 2012 at reported rates was marginally below the comparable period last year. Exillon Energy saw average production slip in April but the company has revealed that its financial performance has been better than expected, with the average selling price of oil ahead of the budgeted level.HICL Infrastructure, the infrastructure investment firm, is now the majority stakeholder in the Colchester Garrison private finance initiative (PFI) project after buying up a stake from design and engineering consultancy WS Atkins. Both stocks fell into the red early on.FTSE 100 - RisersTullow Oil (TLW) 1,530.00p +4.15%Aviva (AV.) 314.70p +4.10%RSA Insurance Group (RSA) 107.20p +2.98%Vodafone Group (VOD) 175.15p +1.95%Hammerson (HMSO) 417.20p +1.51%Resolution Ltd. (RSL) 222.80p +1.41%Land Securities Group (LAND) 739.00p +1.37%SSE (SSE) 1,342.00p +1.21%Capital Shopping Centres Group (CSCG) 321.80p +1.19%United Utilities Group (UU.) 634.00p +1.04%FTSE 100 - FallersMan Group (EMG) 85.15p -4.06%Vedanta Resources (VED) 1,095.00p -2.41%Polymetal International (POLY) 865.00p -2.04%Diageo (DGE) 1,566.50p -2.03%Randgold Resources Ltd. (RRS) 5,020.00p -1.95%Xstrata (XTA) 1,111.00p -1.81%Wolseley (WOS) 2,266.00p -1.48%GKN (GKN) 195.30p -1.31%HSBC Holdings (HSBA) 548.30p -1.23%Antofagasta (ANTO) 1,059.00p -1.21%FTSE 250 - RisersInvensys (ISYS) 214.60p +5.87%Hansteen Holdings (HSTN) 73.90p +4.08%Inmarsat (ISAT) 468.20p +3.47%Talvivaara Mining Company (TALV) 162.40p +3.44%Exillon Energy (EXI) 127.00p +3.25%Stobart Group Ltd. (STOB) 125.20p +3.22%Big Yellow Group (BYG) 309.10p +2.49%SEGRO (SGRO) 220.40p +2.27%London & Stamford Property (LSP) 111.30p +2.11%Heritage Oil (HOIL) 140.30p +2.04%FTSE 250 - FallersMorgan Crucible Co (MGCR) 293.00p -5.79%Aquarius Platinum Ltd. (AQP) 116.50p -4.43%Spirit Pub Company (SPRT) 56.00p -3.86%Rank Group (RNK) 112.60p -3.35%Taylor Wimpey (TW.) 46.20p -3.12%Ferrexpo (FXPO) 264.10p -3.01%Kenmare Resources (KMR) 45.85p -2.65%Essar Energy (ESSR) 130.60p -2.61%Telecity Group (TCY) 781.00p -2.31%Home Retail Group (HOME) 79.45p -2.22%BC