London pre-open: Triple digit rise for Footsie expected

27th Oct 2011 07:20

The market is set to give the thumbs-up to the measures announced by European leaders last night, which included bumping up the region's bail-out fund to €1trn and an agreement with Greek bond-holders that they should take a 50% 'haircut' on the value of the bonds.The response to the announcement may be more of an expression of relief that the European leaders have at least done something, at last, rather than an endorsement of whether the numbers are 'right', in terms of what's needed to ease the region's debt crisis. On the corporate front, Anglo-Dutch integrated oil company Royal Dutch Shell's third quarter 2011 earnings, on a current cost of supplies (CCS) basis, were $7.2bn compared with $3.5bn the same quarter a year ago. Basic CCS earnings per share increased by 104% versus the third quarter of 2010. Broker Charles Stanley had predicted earnings of $6.3bn. Anglo-Swedish pharmaceuticals leviathan AstraZeneca's core operating profit in the third quarter was $3,177m, down 2% on a constant exchange rates (CER) basis. Profit before tax on a CER basis eased 1% to $3,084m. Earnings per share on a CER basis rose 12% to $1.71, versus the 7% increase expected by Credit Suisse. Revenue, on a CER basis, was also down 2%, to $8,213m. Revenue performance was affected by government price interventions and the loss of more than $350m in revenue to generic competition. Mining titan Kazakhmys said its mining and power operations continued to perform in line with expectations in the third quarter and the full-year outcome should be in line with expectations. "Continuing demand for copper is reflected in the current negotiations for our 2012 off-take agreements, which as in previous years should be completed in the next few months. Our growth projects and efficiency programmes also continue to show good progress and we approach 2012 with optimism," said Oleg Novachuk, Kazakhmys's chief executive officer.City traders predict the Footsie will open around the 5,675 level, compared to last night's close of 5,553.