London open: Uncertain start for blue chips

9th Feb 2011 08:48

London has paused for breath after a couple of days of decent gains despite LSE's merger plans and a strong finish on Wall Street where the Dow rose for its seventh straight day.London Stock Exchange is locked in merger talks with Canadian peer TMX that could lead to the creation of the world's largest stock exchange by numbers of companies listed. The combined group, which jointly would be worth about £4.5bn, would also be the home for most mining company listings. The two groups have roughly equal market values at present.LSE is up by over 8%, but Reckitt is weak after full year earnings. International Power is also trading ex a 92p special dividend following its merger with Suez. Reckitt Benckiser, the company that makes Dettol and Cillit Bang, enjoyed strong profit growth in 2010 as developing markets offset a decline in Europe. The company posted a profit before tax for the 12 months of £2.14bn, up 13% from £1.89bn in 2009. Revenue was up 9% at actual exchange rates, or 7% at constant rates, to £8.45bn. Both were a touch below consensus estimates.Newspaper publisher and exhibitions organiser Daily Mail and General Trust (DMGT) said underlying revenue in the final three months of 2010 was up 5%. "Trading in the first quarter has been in line with our expectations, despite our consumer businesses being hampered by the poor weather in December," said chief executive Martin Morgan.The Caribbean market remains subdued for telecoms group Cable & Wireless Communications but growth elsewhere should ensure results for the full year are broadly in line with market expectations. In the group's third quarter (Oct - Dec) the financial performance of Panama rebounded strongly, while Macau and Monaco & Islands continued to trade well. Ultra-trendy youth fashion chain Supergroup's rapid growth sped up even more over Christmas with sales through its shops jumping by more than 90%. Overall, sales in the three months to January rose by 86.9% to £81.7m, from £43.7m, bringing the group total for the nine months of the year so far to £172m, up 75%. Bluetooth chip specialist CSR today confirmed a maiden dividend as fourth quarter revenue came in at the upper end of expectations and results for the year were "robust". In the final three months of 2010, revenue was $184.8m, down 7% on the year before, though it was up 33% over the 52 weeks to $800.6m. Data centre operator Telecity's underlying profits jumped by 45% last year as the public's insatiable appetite for more mobile and data devices shows no signs of abating. Profits rose from £38.1m to £45.9m, with an underlying improvement of 45% excluding one-offs to £51.4m.