The FTSE 100 rallied 1.5% today after it was reported that retail sales in the UK climbed 0.5% month on month in October, marking the first gain in three months, while oil and metal prices rose, giving support to the mining and energy sectors.
Meanwhile, it appears that the situation with Ireland’s debt that has been pressuring the markets is close to a resolution. The International Monetary Fund (IMF) and the European Central Bank (ECB) are in Ireland for talks with the Irish government.
Governor of the Irish Central Bank Patrick Honohan said that the negotiations could result in a loan of tens of billions of euros to Ireland.
In other news, the Bank of England said today that mortgage approvals were unchanged at 44,000 in October.
Beverage group SABMiller (LON:SAB) led the FTSE 100 rally, advancing 4.5% after reporting that its half yearly revenues to 30 September rose 7% with organic, constant currency revenue growth of 4%. Lager volumes were up 1% on an organic basis with good volume growth in Africa, China and South Africa, predominantly in the second quarter.
Earnings before interest, taxes and amortisation (EBITA) of US$2,466 million represented growth of 13%, or 10% on an organic, constant currency basis.
Mining stocks were in demand today after base metals climbed with copper and nickel reaching US$3.80/lb and US$10.27/lb respectively. Kazakhmys (LON:KAZ) and Rio Tinto (LON:RIO) added 3%, while sector peers Eurasian Natural Resources (LON:ENRC) and Vedanta Resources (LON:VED) added 2.5%.
Dow Jones Newswires reported that chairman of Oil & Natural Gas Corp (ONGC) said that the company would not be an impediment to Cairn Energy’s (LON:CNE) sale of a 60% stake in its India operating subsidiary Cairn India to Vedanta Resources for US$9.6 billion.
Shares in Cairn Energy surged 3% today.
Other top risers of the day included airline British Airways (LON:BAY) and InterContinental Hotels Group (LON:IHG), which added 3% and 2.5% respectively.
Outsourcer Capita Group (LON:CPI) was the heaviest faller in the FTSE 100, shedding 5.2% after saying that it expects turnover growth for 2010 to be “modest due to the unusually high degree of revenue attrition in the year, fewer sales decisions to date in the second half of this year and the short term impact of current public sector retrenchment on some of our trading businesses”.
Intertek (LON:ITRK) followed with a 4% loss. The quality and safety services company also released its interim management statement today, in which it said that it expects the second half margin to be in-line with that of the equivalent prior year period resulting in a full-year margin slightly below the prior year.
Broker Seymour Pierce downgraded its recommendation for the stock from “add” to “hold”.
National Grid (LON:NG) declined 1.5% after releasing its half yearly report. Profits in the six months to 30 September surged 45% to £938 million, while earnings per share rose 5% to 20.3 pence.
In the US, futures for the Dow Jones and S&P 500 indexes added nearly 1% today, pointing to an early rally on Wall Street after the main indexes closed flat following a volatile session on Wednesday.
Yesterday’s housing data was bearish, showing a decline of 11.7% in housing starts to 519,000 in October and a small increase of 0.5% in building permits to 550,000 in the same month.
Another update showed that core inflation in the US posted the smallest increase ever in October, rising just 0.6% year on year. The all-inclusive consumer prices index (CPI) climbed 0.2% during the month.
The macroeconomic data due to be released today includes US weekly jobless claims and the Philly Fed manufacturing index.
Small Cap News
Stratex International PLC (LON:STI) has signed a binding Heads of Terms agreement with privately owned LozBez Mining Private Ltd Co to option into the AbiAdi-Gichke gold project located in the prospective Tigray province in northern Ethiopia.
GGG Resources (LON:GGG) has begun the stage of drilling to increase the existing 2 million ounce gold resource at the Bullabulling gold project in Western Australia.
Strategic Natural Resources (LON:SNRP) gave a hint of its future plans in South Africa as it updated on the progress of its Elitheni coal mine near Indwe, in the Eastern Cape Province. The group said it has received “numerous enquiries” for its coal from “traders, power developers and brokers” and is advanced discussions with several potential partners.
Chief financial officer (CFO) and company secretary of Minera IRL (LON:MIRL, TSX:IRL, BVL:MIRL) Richard Michell will retire on 31 December, to be succeeded by current vice president for corporate finance Tim Miller.
Plant Impact (LON:PIM) has successfully registered its products in Brazil, which is a large and important new territory for the company. Crucially, Brazil's location in the Southern Hemisphere will give Plant Impact a second development growing season for its crop nutrition and protection products.
Fox-Davies Capital is bringing privately-held Copper Development Corporation (CDC) to London’s AIM market with a US$50 million IPO next month.
Aminex (LON:AEX) told investors that trading from the beginning of the third quarter has been approximately in line with expectations and outlined its plans for 2011.
Range Resources (LON:RRL, ASX:RRS) shares shot up 30 percent in early trades after the group told investors that it has six priority drill targets in Georgia with an estimated 728 million barrels of oil-in-place. By mid-morning Range shares had climbed 1.35 pence to 7.55 pence on London’s AIM market, up 22 percent from Wednesday’s close.
Synchronica (LON:SYNC, TSX-V:SYN) has signed its 60th mobile operator, extending its addressable market to nearly 1 billion potential end-users. As recently as in June, the company signed its fortieth mobile operator customer. The company's addressable user base has increased by an impressive 43% since then.
Regency Mines (LON:RGM) announced the start of an 837 line kilometre programme of airborne geophysics this week on some of its Western Australian licenses, and that it started preparatory exploration at Bundarra in Queensland.
Avia Health Informatics (LON:AVIA) is expanding its client base in the UK despite the uncertainty in the NHS. The company has won three new contracts for its Odyssey clinical decision support systems, with NHS Primary Care Trusts (PCTs) and University Health Boards (UHBs) across the UK.
Mobile Streams (LON:MOS) this morning revealed its Appitalism.com applications service has hit a significant milestone. It now has more than 10 million music downloads suitable for phones and home computers. The company has signed up the major independents as well as four main music labels - EMI, Sony Music, Universal Music Group and Warner Music Group.
Red Rock Resources (LON:RRR) told investors that drilling is now underway at the Migori gold project in Kenya. The stock hit a new high of 14.75 pence on London’s AIM market this morning after they climbed 2.25 pence, or 16 percent.
Large and Mid Cap News
Kenmare Resources (LON:KMR) said it will “vigorously appeal the record €10 million libel damages awarded by an Irish court after a jury yesterday found a company press release defamed a former director. It wants the verdict and the amount set aside and will petition for a retrial.
Weir Group PLC (LON:WEIR) said it has acquired American Hydro Corp, a manufacturer of high-efficiency turbine components for hydro-electric power generation.
Heritage Oil (LON:HOIL) has commenced extensive testing of target formations and is accelerating a large 3D seismic programme across the Miran block in the Kurdistan region of northern Iraq.