London open: Stocks pull back but Xstrata soars

2nd Feb 2012 08:35

Stocks opened slightly lower on Thursday, pulling back from the +100 point gain for the Footsie yesterday as markets celebrated positive global macroeconomic data with manufacturing indices in the UK, Eurozone, US and China all showing an improvement in January.In other news, ratings agency Standard & Poor's predicts that 2012 will be a year of a soft landing for the Chinese economy. Chinese gross domestic product (GDP) growth is expected to fall to around 8% this year, from the 9.2% expansion in 2011, but the agency sees less chance of a medium or hard landing, with GDP grow slowing to 7% or 5%, respectively.XSTRATA LEADS MINERS HIGHERMining giant Xstrata surged over 10% after confirming that it is in discussions with Glencore regarding an merger. Glencore rose by a lesser 2.4%, while sector peers Anglo American, Randgold Resources, Rio Tinto and BHP Billiton were also making decent gains. BHP announced this morning $917m in pre-commitment funding for the construction of an outer harbour facility for its Western Australia iron ore operations.Fourth quarter sales at medical devices maker Smith and Nephew came in a touch shy of market expectations, but showed a modest improvement on the previous year's fourth quarter figure. Shares rose nearly 3% early on.Leading the downside was consumer goods titan Unilever, which fell despite seeing underlying year-on-year sales growth of 6.6% in the fourth quarter.AstraZeneca shareholders also seemed disappointed after the company announced 7,300 job cuts in order to "enhance productivity" and reduce costs. The pharmaceuticals giant announced a 1% rise in full-year revenues and a 29% increase in earnings per share in 2011, but warned that both revenues and earnings will decline in 2012 due to government interventions on pricing and ongoing generic competition.Anglo-Dutch integrated oil behemoth Royal Dutch Shell fell after underlying fourth quarter earnings came in below expectations. Net income on a current cost of supplies (CCS) basis, excluding various exceptional items such as gains from divestments and fair value accounting adjustments, rose to $4.8bn from $3.1bn the year before, but were below the $5.2bn the market was expecting.Food and support services firm Compass edged higher after saying that it has had a good first quarter and its expectations for the full-year remain unchanged, despite experiencing a continuing challenging macroeconomic environment in Europe.ON THE FTSE 250...Defence technology firm QinetiQ rose after saying it expects to meet full year forecasts. However, the group cautioned that conditions in UK and US defence markets remain challenging as deficit reduction programmes make future demand levels difficult to predict.Cheese and milk producer Dairy Crest edged higher as group sales increased by 2% in the first nine months of the year on a like for like basis.BCFTSE 100 - RisersXstrata (XTA) 1,236.00p +10.41%Vedanta Resources (VED) 1,286.00p +2.80%Smith & Nephew (SN.) 629.50p +2.78%Glencore International (GLEN) 442.20p +2.42%Anglo American (AAL) 2,789.00p +2.05%Randgold Resources Ltd. (RRS) 7,425.00p +1.71%Rio Tinto (RIO) 3,975.50p +1.62%BHP Billiton (BLT) 2,207.00p +1.49%Johnson Matthey (JMAT) 2,187.00p +1.30%Compass Group (CPG) 608.50p +1.25%FTSE 100 - FallersUnilever (ULVR) 2,021.00p -3.07%AstraZeneca (AZN) 3,012.50p -2.49%Royal Dutch Shell 'B' (RDSB) 2,268.50p -2.47%Royal Dutch Shell 'A' (RDSA) 2,219.50p -2.16%BP (BP.) 474.75p -1.71%BG Group (BG.) 1,429.50p -1.11%GlaxoSmithKline (GSK) 1,411.50p -0.91%Barclays (BARC) 222.50p -0.71%Hammerson (HMSO) 375.30p -0.69%ARM Holdings (ARM) 588.50p -0.68%FTSE 250 - RisersLonmin (LMI) 1,097.00p +3.49%QinetiQ Group (QQ.) 140.10p +2.71%Bodycote (BOY) 329.00p +2.68%Bovis Homes Group (BVS) 481.20p +2.36%Spirent Communications (SPT) 123.40p +2.24%Shanks Group (SKS) 101.60p +1.75%Petropavlovsk (POG) 800.00p +1.52%Misys (MSY) 326.00p +1.49%SVG Capital (SVI) 224.00p +1.36%Ferrexpo (FXPO) 354.30p +1.20%FTSE 250 - FallersGo-Ahead Group (GOG) 1,250.00p -3.03%FirstGroup (FGP) 307.90p -2.72%Diploma (DPLM) 415.40p -2.37%Taylor Wimpey (TW.) 42.72p -2.02%Bellway (BWY) 743.00p -1.98%COLT Group SA (COLT) 91.20p -1.94%Cape (CIU) 393.80p -1.80%Great Portland Estates (GPOR) 362.20p -1.79%Sports Direct International (SPD) 246.10p -1.68%Domino Printing Sciences (DNO) 591.50p -1.66%