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FTSE 100 shrugs off US worries

Risers outnumbered fallers by four-to-one among Footsie constituents, as UK investors learnt to stop worrying about the US Budget talks deadlock.

FTSE 100 rose 41 to 6,549, while the FTSE 250 climbed71 to 15,128.

The top riser among UK blue-chips was mining major Rio Tinto (LON:RIO), which was up 4.3% to £32.15 after the group’s copper production as its new mine in Mongolia underpinned a much better than expected third quarter for the mining giant.

Copper output jumped by 23% in the three months to September, as Oyu Tolgoi in Mongolia continued its ramp-up, while Kennecott in the US recovered from its wall slide earlier this year.

Advertising conglomerate WPP (LON:WPP) was wanted, hardening 3.1%, after it announced that this week’s acquisition is IM2.0, a digital advertising and media agency in China.

Burberry (LON:BRBY) tumbled 7.6% to £14.64 after chief executive Angela Ahrendts decided it is time to get her coat.

She is to be to be senior vice president for Apple’s retail and online stores. She will be replaced at Burberry by chief creative officer Christopher Bailey by mid-2014, who will join the board as part of a promotion that sees him take on both roles.

Outside of the top-tier, hedge fund group Man Group (LON:EMG) was back in fashion, rising 6.4% after UBS gave it a more upbeat write-up.

Bellway (LON:BWY) was up 4.8% after reaping the rewards of the government’s Help to Buy scheme, which helped profits rise by a third last year to £141mln.

Britain’s fourth biggest housebuilder said the government loans were to thank for satisfying “previously restrained consumer demand”, improving the availability of mortgages for first-time home buyers.

It meant 8% more homes were sold in the year to July 31, with the average selling price up 3% to £193,000.

The strong numbers prompted a 50% jump in the dividend to 30p a share, described as a “massive” increase by broker Panmure Gordon.

The bulls are outgunning the bears on the Royal Mail (LON:RMG) share issue. Trading officially started today, and the shares closed up 14p at 489p.

AIM oil explorer Fastnet Oil & Gas (LON:FAST) was up 11% to 19.25p after hailing BP’s (LON:BP.) farm-in to offshore Morocco as an “an unequivocal validation by the oil industry” of the region.

BP has done a deal with Kosmos for three blocks offshore Morocco, one of which is Foum Assaka, where Fastnet has an 18.75% stake.

BP will take 26.3% non–operating stake in Foum Assaka through the farm-in, with Kosmos’s stake reduced to 29.9%.
dotDigital (LON:DOTD) was another strong riser, up 8.9% to 19.88p after mailing in a forecast-beating set of full-year results and surprising the market with the proposal of a maiden dividend.

The software-as-a-service specialist, which is behind the dotMailer email marketing tool, welcomed a 16% rise in turnover to £13.8 million, from £11.9mln in 2012, and an 18% increase in pre-tax profits to £3.3mln, up from £2.8mln.

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July 31 2012

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