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.


AB Foods props up FTSE 100 as Primark sales surge

January 17 2013, 1:32pm
AB Foods props up FTSE 100 as Primark sales surge


AB Foods (LON:ABF) shot to the head of the UK’s top share index after a sterling performance over Christmas from its clothing retail chain Primark.

The company saw retail sales grow 25% from the previous year, ahead of expectations, sending shares up 7%.

Total group revenue rose 10% in the period, boosted also by a 12% increase in sugar sales.

“Year to date trading for the group was ahead of our expectations driven by the outstanding performance from Primark, with the rest of the group performing in line,” a statement from the company read.

The figures prompted City firm Panmure Gordon to raise its target price to 1,670p from 1,450p. The broker kept its ‘hold’ rating on the shares.

The stock helped the FTSE 100 rise 10 points or 0.15% to 6,114.

Mining heavyweight Rio Tinto (LON:RIO) dropped towards the foot of the top flight in the wake of the sacking of chief executive Tom Albanese, who oversaw a $14bn in write-downs.

The chairman said the $3bn it will lose from its recently purchased Mozambique coal operations was not acceptable.

City analysts looked on the bright side, calling the shock departure a victory for shareholders, with Citigroup going so far as to upgrade the stock to ‘buy’.

Xstrata (LON:XTA) suffered, losing 1.6% after a downgrade to ‘neutral’ from French broker Exane BNP Paribas, while fellow mining giant Anglo American (LON:AAL) shed 1% on a downgrade to ‘underperform’ from the same broker.

Home Retail (LON:HOME) soared 14% after boosting Christmas sales at Argos, with tablets the big seller over the festive season.

Investors cheered the news that its online push seems to be paying off after fears it could struggle to cope with the changing consumer demands.

Chief executive Terry Duddy had the City’s abacus rattlers in a bean-sliding frenzy as he revealed headline profit before tax for the year would be about £10mln higher than current market expectations at £83mln.

Dixons Retail (LON:DXNS) followed it north after impressive set of numbers from the Currys and PC World owner.

Tiddlers moving and shaking today included gold explorer Triple Plate Junction (LON:TPJ), up 27%, as well as stem cell specialist ReNeuron (LON:RENE), which leapt 25%.

Nyota Minerals (LON:NYO) climbed 7% after edging closer to being able to dig for gold at its Tulu Kapi project in Ethiopia.

The country’s mining ministry confirmed the AIM-listed mineral explorer’s definitive feasibility study (DFS) met the requirements for a mining licence.

Nyota said that after talks with the ministry over the fiscal and legal aspects of the Tulu Kapi plans, both parties believe that they are close to finalising the terms for the issuance of a mining licence.

The company has also received an extension of its exploration licence, which it said means it can conclude preliminary preparations for the resettlement of people living within the proposed mining licence area and further exploration at Tulu Kapi to optimise the project.

Fellow mining minnow Afferro Mining (LON:AFF) moved 3.5% higher as it confirmed that Indian giant Jindal Steel and Power is one of a number of the junior miner's potential suitors.

Crowdsourcing blur Group (LON:BLUR) retreated 13%. The stock has made big gains in recent weeks, up 65% in the last five days alone as it made its legal and accounting exchanges live.


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