London pre-open: Rally set to continue

16th Jun 2010 07:39

It looks like being another strong start for London following last night's 200-point rally on Wall Street, with the FTSE 100 looking to make it six up days in a row.US traders piled into stocks after debt auctions in Spain and Belgium attracted decent demand, alleviating some of the fears about another crisis in the eurozone.Futures prices point to a 45-point gain for our leading index when trading begins at 8am.In company news this morning, Sainsbury's has outdone arch rival Tesco in the growth stakes with a 4.6% increase in like for like sales during the first quarter and is apparently doing a roaring trade in Vuvuzela horns. Britain's third largest supermarket said like for like sales excluding petrol increased by 1.1% during the 12 weeks to 12 June. Tesco yesterday reported UK like for like sales up 1.1% and just 0.1% without fuel. "We have made a good start to the financial year in line with our expectations," said boss Justin King.BP will likely steal more headlines after last night's address from the Oval Office by President Obama. He demanded that the oil giant hand over control of compensation payments for the Gulf Coast oil spill. Official estimates now put the amount of oil leaking into the Gulf at 60,000 barrels a day compared with initial estimates from BP of just 5,000.The Times also reports that BP's credibility as an international oil company is under further threat after the Brazilian Government raised doubts over its $7bn deal to buy deepwater assets in Brazil. The paper has learnt that the Brazilian oil industry regulator is reviewing the BP deal with Devon Energy announced on March 11 ? six weeks before the Deepwater Horizon blast. Top Brazilian officials are being sent to Texas to question BP about the catastrophe.Elsewhere, the environment for government and public sector contracts has worsened markedly under the new coalition government, consultant and civil engineer contractor Mouchel warned, with its order pipeline falling since March. It said the short-term outlook is difficult, but the underlying performance for the current year to the end of July will be in line with its expectations, excluding any one-off costs of restructuring. Part-nationalised lender Royal Bank of Scotland has sold another piece of its sprawling empire, getting shot of a Pakistani subsidiary at the second attempt. It has reached agreement for the sale of its 99.37% holding in RBS Pakistan to Faysal Bank Limited for €41m, or about 2.5 rupees per share, a substantial discount to last night's closing price in Karachi.Speciality plastic and fibre products provider Filtrona continues to trade ahead of expectations. Having cheered its shareholders back in April with news of strong trading the group said that the outperformance has continued for the nine week period to 5 June.