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The Mid Session Wrap is a report on the biggest movers in the FTSE 100 and macroeconomic news that impacts movements in share prices. The report also previews macroeconomic data that is due to be released over the course of the session.
FTSE 100 hangs on as US opens lowerJanuary 08 2013, 3:44pm
US benchmarks have opened lower ahead of the first quarter results season, which kicks off this evening with an update from aluminium producer Alcoa.
The Dow Jones industrial average is off 42 points at 13,342 while the broader based S&P 500 is two points lighter at 1,460. The tech-laced NASDAQ Composite is down six at 3,093.
Investors have little appetite for Yum Brands, owner of the KFC and Taco Bell fast food chains, after the company revealed like-for-like sales declined more than expected in China.
In contrast, traders are tucking into seed company Monsanto after its first quarter earnings came in ahead of expectations.
Aircraft maker Boeing is experiencing a bit of turbulence after being downgraded by BB&T Capital Markets.
In other broker action, JPMorgan Chase has downgraded Halliburton, the oilfield services giant.
Back in the UK, the blue-chip index is just about clinging on to positive territory, up 2 at 6,067.
Shire (LON:SHP) is the best blue-chip performer after news emerged that it has agreed to acquire Lotus Tissue Repair, the biotech firm.
The end of uncertainty over succession at the top has down wonders for the share price of Anglo American (LON:AAL). Shares are up 2.12% on the day the company unveiled its new chief executive.
Mark Cutifani will take the reins at the mining heavyweight, taking over from Cynthia Carroll, who has been at the helm for five years.
Vodafone (LON:VOD) rises 2% but is off its highest level, as investors cross their fingers in hope of a £50bn sale of its US venture Verizon Wireless.
The mobile phone giant’s shares hardened after Verizon Communications – which owns 55% of the wireless business, with Vodafone owning the remaining 45% – declared its interest in owning the whole of the venture.
Chief executive of the majority shareholder Lowell McAdam told the Wall Street Journal that “we have always said we would love to own all of that asset”.
The future of Verizon Wireless has been subject to much speculation, particularly in the wake of Vodafone’s decision to sell off its minority stakes in other businesses aimed at streamlining the company.
TUI travel (LON:TT.) meanwhile journeyed south, losing 3.7% as Morgan Stanley urged investors to sell shares in the stock. The broker cut its rating on the tour operator from ‘equal weight’ to ‘underweight’.
Tullow Oil (LON:TLW), down 4.0%, suffered at the hands of Investec, whose analysts dropped the stock to ‘sell’ today.
African Barrick Gold (LON:ABG), which lost 20.3%, hit the mid cap index, sparking a selling frenzy after talks over the sale of parent Barrick’s 74% stake to China National Gold (CNG) collapsed.
Debenhams (LON:DEB) also performed poorly. It lost 6.9% after warning of tough times ahead – not just for the department store but for the retail sector in general.
International veterinary pharmaceutical business Dechra Pharmaceutical disappointed the market with its trading update. The shares slipped 4.0% as the company said the European business was hit by adverse exchange rate fluctuations, with Panmure Gordon estimating that FX headwinds shaved some 6.9 percentage points from organic growth, which was reported as down 2.4%.
Embattled miners Centamin (LON:CEY) and Bumi (LON:BUMI) found themselves at the top of the mid-tier league.
The former rose 9% after being given the all-clear to export gold from Egypt, while the latter lifted 6% after granting founder Nat Rothschild’s request for a shareholder meeting in his bid to regain control of the company.
Ferrexpo (LON:FXPO) joined them, up 3.8% after boosting its iron ore pellet production in Ukraine.
Investors bought into house builders after a bullish sector note from Deutsche Bank.
Bovis (LON:BVS), Barratt (LON:BDEV), as well as Taylor Wimpey (LON:TW) and Redrow (LON:RDW), edged towards the top of the index with another good year ahead, according to the broker.
The biggest increase of the day came from Roxi Petroleum (LON:RXP). Its shares doubled after unveiling a US$40mln funding package that has seen a Kazakh businessman buy stock at a significant premium to the prevailing share price.
Kairat Satylganov is buying 355.2mln new shares in the oil and gas junior for 7p each. This compares with last night’s close of 2.125p.
The cash injection will allow the group to drill three deep wells on its BNG licence in Kazakhstan this year.
Nautilus Minerals (LON:NUS, TSE:NUS) was wanted, up 42.7%, after advising its shareholders to sit tight as the company waits to see whether a bid is forthcoming from minority shareholder Michael Bailey.
The company has become aware of plans for Bailey and an entity he controls to make an unsolicited offer for the company.
Bailey intends to pitch his cash bid at C$0.97 a share for the Toronto and AIM listed resource stock. The terms value Nautilus at C$238mln.
Among those tracking them north were Chinese unconventional gas driller Greka Drilling (LON:GDL), up 12%, and Telit Communications (LON:TCM), which climbed 10% after a director bought shares in the company, taking his holding to just under 5%.
North River Resources (LON:NRRP) and IPSA Group (LON:IPSA) fell the other way, down 14% and 9% respectively.
Deltex Medical (LON:DEMG) is down 7.1% after a trading update in which it bemoaned the sluggish decision making process of the NHS.
The oesophageal Doppler monitor (ODM) maker’s group sales in 2012 rose to £6.8mln from £6.3mln the year before but could have been higher had the UK National Health Service been a little quicker bringing in the company’s breakthrough device.
The NHS took the best part of a year sorting out the fine details of its plan to implement the ODM throughout England.
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