Sector movers: Rexam, DS Smith boost industrials higher

22nd Feb 2012 16:24

The general industrial sector was performing strongly today after a strong rise from FTSE 100 heavyweight consumer packaging firm Rexam provided a boost to the sector.Shares surged nearly 7% after underlying profits raced ahead of sluggish sales on the back of a better than expected performance in its Beverage Cans business, primarily in Europe. Underlying profit before tax rose 15% in 2011 to £450m from £390m in 2010, ahead of market expectations of £443m. Sales edged up 2% to £4,734m from £4,619m in 2010; the median forecast from the range of analysts covering the stock was for sales of £4,716m. Meanwhile, recycled packaging company DS Smith rose strongly on the FTSE 250 after completing a successful rights issue, raising the money it needs to pay for its purchase of Swedish firm SCA Packaging. By the deadline at 11:00 yesterday it had received acceptances for 98.61% of the offered shares in the nine-for-eight cash raising exercise. Today its underwriters, J.P. Morgan, has managed to sell the outstanding 1.39% of the offer. The total cash raised will be around £466m, which, along with loans, will pay for the SCA transaction. Meanwhile, the food and drug retailers were out of favour today, with supermarket giant Tesco weighing on the sector.Supermarket giant Tesco fell 2.23% in afternoon trade after Bank of America Merrill Lynch downgraded the stock from neutral to underperform. Meanwhile, in a separate note, downbeat comments by the US investment bank on the outlook for the UK grocers could be weighing on the wider sector with Ocado and Sainsbury in the red.BCTop performing sectors so far todayGeneral Industrials 3,172.03 +3.42%Forestry & Paper 6,182.76 +2.14%Electronic & Electrical Equipment 3,397.89 +1.34%Support Services 4,772.12 +1.31%Aerospace and Defence 3,692.80 +1.24%Bottom performing sectors so far todayIndustrial Metals & Mining 4,468.96 -2.43%Food & Drug Retailers 3,981.36 -1.12%Industrial Transportation 2,436.70 -1.08%Banks 4,045.84 -1.07%Mobile Telecommunications 4,042.62 -0.79%