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Gold, silver and platinum climb to bolster Randgold, Fresnillo and Lonmin, FTSE 100 climbs

23rd Nov 2009, 1:22 pm Gold, silver and platinum climb to bolster Randgold, Fresnillo and Lonmin, FTSE 100 climbs

Overview: the UK blue chips were more resilient than was predicted in pre-open with the FTSE 100 adding 1.6%, while projections had it rising less than 1% early in the day. Miners once again were the main driving force behind the Footsie’s climb, advancing after metal prices rose to recover from their recent declines.

Resources stocks flooded the leaderboard with base metals focused Eurasian Natural Resources (LSE: ENRC) and silver miner Fresnillo (LSE: FRES) making it to the top three with gains of over 4%. Inter-dealer money broker ICAP (LSE: IAP) joined in, advancing 4.5%. Royal Bank of Scotland (LSE: RBS) was the only other non-mining stock to make it to the leaderboard. The bailed out bank rose 3.5%.

Just three FTSE 100 constituents lost 1% or more this morning. Energy company Tullow Oil (LSE: TLW), testing and inspections group Intertek (LSE: ITRK) and packaging group Bunzl (LSE: BNZL) declined 1.3%, 1.1% and 1% respectively.

US stock index futures rose this morning, pointing to a higher open on Wall Street. The Dow Jones, S&P 500 and Nasdaq futures all added about 1%.

Commodities

Oil prices rose today with January Brent Crude rising to US$78.27/barrel, while US light, sweet crude for January delivery reached US$78.35/barrel.

Major oil and gas stocks advanced this morning with only a few exceptions, including Tullow Oil (LSE: TLW), which lost 1% and Petrofac (LSE: PFC) with a marginal decline.

Supermajors BP (LSE: BP) and Shell (LSE: RDSB) both added 1%, while Cairn Energy (LSE: CNE) was up 1.7% and BG Group (LSE: BG) tacked on less than 1%.

Midcaps were mixed as while Dana Petroleum (LSE: DNX) and Dragon Oil (LSE: DGO) moved with the sector and added more than 1%, Heritage Oil (LSE: HOIL) tumbled 6% after announcing its intention to sell its entire interests in Blocks 1 and 3A in Uganda to Italian energy giant Eni (NYSE: E).

US focused junior Empyrean Energy (AIM: EME) was one of the top performers in the sector, gaining 5%. Ukraine focused gas producer, Regal Petroleum (AIM: RPT) and Irish oil and gas exploration company Petroceltic International (AIM: PCI) also did well, climbing about 3%.

Peru, Colombia and Cuba operating oil and gas explorer and producer Gold Oil (LSE: GOO) was in decline, shedding almost 10%. Europe focused oil and gas developer Ascent Resources (AIM: AST) followed with a 5% loss, while energy investor Xtract Energy PLC (AIM: XTR) and EU operating Rome-based oil junior Mediterranean Oil & Gas (AIM: MOG) slid 3.5% and 3% respectively.

Gold, silver and platinum rise to boost miners

Precious metals were buoyant with gold reaching new highs at US$1,165/oz, while silver and platinum improved to US$18.78/oz and US$1,466/oz respectively.

Major mining stocks did well today as FTSE 100 constituents gold miner Randgold Resources (LSE: RRS), silver producer Fresnillo (LSE: FRES) and platinum miner Lonmin (LSE: LMI) all posted identical gains of 4.3%.

Specialty chemicals firm Johnson Matthey (LSE: JMAT) rose 2.6%.

Yamana Gold (LSE: YAU) climbed 4%.

Turkey and Saudi Arabia operating gold explorer KEFI Minerals (AIM: KEF) and Tajikistan operating gold miner Kryso Resources (AIM: KYS) were among the leading risers in the sector, climbing 12.5% and 10% respectively, while Turkey focused gold miner Ariana Resources (AIM: AAU), Africa focused gold deposit developer Cluff Gold (AIM: CLF), Africa operating gold miner GMA Resources (AIM: GMA) and Lesotho operating diamond miner Kopane Diamond Developments (AIM: KDD) followed with gains of over 3%.

Philippines focused Metals Exploration (AIM: MML), Latin American precious metal miner Minera IRL (AIM: MIRL) and Brazil focused gold miner Horizonte Minerals (AIM: HZM) went in the opposite direction, sliding 8%, 4% and 3% respectively.

Copper and nickel climb

Base metals gave up some of their early gains, but still remained above Friday’s levels. Copper and nickel were at US$3.13/lb and US$7.64/lb respectively, while zinc was sitting at US$1.02/lb.

Eurasian Natural Resources (LSE: ENRC) led the sector in the FTSE 100 with a 4.6% climb. Xstrata (LSE: XTA), Rio Tinto (LSE: RIO) and Kazakhmys (LSE: KAZ) all advanced 3.5%.

Anglo American (LSE: AAL) and BHP Billiton (LSE: BLT) followed with gains of about 3%.

Antofagasta (LSE: ANTO) and Vedanta Resources (LSE: VED) climbed 2%.

London's only listed pure iron ore producer and FTSE 250 constituent, Ferrexpo (LSE: FXPO) emerged as the top performer in the sector, tacking on 6%.

South American focused junior miner Herencia Resources (AIM: HER) and zinc mining and recycling specialist ZincOX (AIM: ZOX) performed well, adding 5% and 3% respectively.

Russia focused copper and nickel miner Amur Minerals (AIM: AMC) was in decline, sliding 5%. Cement operator Prosperity Mineral Holdings (AIM: PMHL) also fell, shedding 3%.

Banks, insurance, private equity

Standard Chartered (LSE: STAN) was in the lead in the banking sector with a 3.3% gain. Royal Bank of Scotland (LSE: RBS) also added more than 3%, while fellow part-nationalised bank Lloyds (LSE: LLOY) climbed 2.7%. Barclays (LSE: BARC) and HSBC (LSE: HSBA) tacked on 2.8% and 2.2% respectively.

Insurance stocks mostly rose, with the sole exception of Old Mutual (LSE: OML), which posted a marginal loss.

Prudential (LSE: PRU) was in the lead with a 2.5% advance, while Standard Life (LSE: SL) followed with a gain of over 1.5%. Aviva (LSE: AV) and RSA Insurance Group (LSE: RSA) climbed about 1%. Legal & General (LSE: LGEN) and car insurer Admiral Group (LSE: ADM) rose marginally.

Private equity group 3i (LSE: III) rose 1.8%.

Small Cap Movers

Other notable movers among the small caps included African focussed soft commodity specialist, Agriterra Limited (AIM: AGTA) with a loss of 6% and emerging speciality pharmaceutical company Alliance Pharma (AIM: APH), which added almost 10%.

Large and Mid Cap News

Heritage Oil Plc (LSE: HOIL) announced that it has entered into a binding letter of intent, with Eni S.p.A for the sale of its entire interests in Blocks 1 and 3A in Uganda for up to $1.5 billion in a cash deal. Additionally this morning, Heritage declared that merger discussions with Genel have been terminated.

Experian Plc (LSE: EXPN) announced that it has created to joint venture in partnership with seven Indian banks, to establish a Credit Information Company in India. In April this year Experian was one of the few companies to be granted a provisional licence to operate a ‘credit bureau’ in India.

RiskMetrics Group, a provider of risk management and corporate governance products and services to publicly listed companies, urged shareholders in Aquarius Platinum (LSE: AQP) to replace Ernst & Young as auditor after the Company paid non-audit fees of US$0.68 million.

FTSE100 international security firm, G4S (LSE: GFS) announced the acquisition of All Star International (All Star) for a cash consideration of US$59.9 million. All Star is the trading name of US secure facilities management company ‘Champions of the West’.

Small Cap News

Supplier of human tissue and human tissue-based services Asterand (AIM: ATD) has announced the extension of its collaboration with Bristol-Myers Squibb Company (NYSE: BMY) for access to its products and services for up to three years, focusing on its PhaseZERO drug discovery services and XpressBANK of human tissue and clinical samples.

First Quantum Minerals Ltd (TSX: FM; LSE: FQM) said it has agreed a recommended offer to buy Kiwara PLC (AIM: KIW; JSE: KWR) in a cash and shares deal, valuing the Zambia-focused mineral exploration and development company at approximately US$260.2 million.

Kurdistan focused exploration and production oil junior, Gulf Keystone Petroleum (AIM: GKP, ADR: GFKSY) were on the move again this morning after the company reported further results from the hugely successful Shaikan-1 Exploration Well.

Broker Fox-Davies Capital (FD-Capital) noted the latest discovery announcement from Iraq and Algeria operating Gulf Keystone Petroleum (AIM: GKP), calling its Shaikan-1 well in the Kurdistan region of northern Iraq “unstoppable” and increasing its target for the company to nearly double the current price.

Interim results from IT services provider, Phoenix IT Group (AIM: PNX) (‘Phoenix’) were received well by shareholders this morning after the company reported an encouraging start to the first half of its financial year.   Phoenix provides a range of IT services including network infrastructure support, managed services and specialist services.

Mobile web payments and analytics company Bango (AIM: BGO) has entered into a multi-territory agreement with Fox Mobile Group to provide it with its mobile web building platform services worldwide.

Manufacturer of laser screeding and profiling equipment Somero Enterprises (AIM: SOM) now expects its trading results for the full year to be below expectations as market conditions remained challenging.

Go-Ahead Group (LSE: GOG) has confirmed it has made a cash offer for 100% of the share capital of Plymouth CityBus (PCB) from Plymouth City Council (PCC), valuing it at £20 million.

Transense Technologies (AIM: TRT) (Transense) announced it has acquired the intellectual property (IP) relating to the Pneu-Logic Bluetooth-tyre inspection tools for an initial cash payment of £50,000. In June this year, Transense sealed a distribution deal for Pneu-Logic products. Today’s deal will allow Transense to reduce item costs in the competitive fleet service industry, which has recently seen rising tyre and fuel prices. Investors appear to be buoyed by the deal as Transense shares climbed 5% on the AIM market this morning.

West African Diamonds PLC (AIM: WAD) told shareholders at the annual General meeting that the planned merger with Stellar Diamonds Ltd is proceeding well, and a relisting of the enlarged entity on AIM is planned for early February 2010.

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