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Wall Street rebounds, FTSE 100 set to rise ahead of Q3 corporate reports

5th Oct 2009, 2:59 am Wall Street rebounds, FTSE 100 set to rise ahead of Q3 corporate reports

The FTSE 100 seems to have found a floor after declining for most of the last week, taking the hardest hit on Friday when the US non-farm payroll data turned to be worse than expected, causing the UK’s blue chip index to slip over 1% and move back below the 5,000 mark it recaptured a few weeks ago. Wall Street seemed to be headed for recovery on Friday as the Dow Jones industrial average trimmed early losses to a just 7 points. Oil prices responded with decline with November Brent Crude sliding to US$78.08/barrel and US light, sweet crude for November delivery slipping below US$70 to settle at US$69.90 per barrel.

Gold quickly bounced back after falling to below US$1,000/oz, rising to US$1,003/oz. Silver improved to US$16.27/oz, but Platinum slightly declined, settling at US$1,277/oz.

Base metals fell into about the same pattern, regaining some of the value they lost early on Friday. Copper rose to US$2.67/pound, while Nickel climbed to US$7.76/pound. Zinc also improved, arriving at US$0.84/pound.

The Footsie is projected to rise up to 20 points in early trade. Investors will be waiting for the UK CIPS/Markit Purchasing Managers’ Index update, due to be released at 8:28 AM GMT.

Morning News Wrap

In the FTSE 100, software developer Autonomy Corporation (LSE: AU) said it has entered into a license agreement with US retailer Sears for its IDOL (Intelligent Data Operating Layer) software.

Insurer Aviva (LSE: AV) said it will sell a part of its stake in Delta Lloyd as part of the company’s IPO (initial public offering), which was confirmed this morning. The IPO is expected to complete in November this year.

In the FTSE 250, engineering firm Balfour Beatty (LSE: BBY) said it has secured a £77 million contract to build new student accommodations at the University of Exeter and three design and build contracts totalling £57 million from Lincolnshire City Council. The deals have a combined value of £134 million.

Countermeasures and energetic materials manufacturer Chemring Group (LSE: CHG) also announced a contract win, saying its US subsidiary Kilgore Flares Company was awarded an IDIQ (indefinite delivery/indefinite quality) contract for the supply of infra-red decoy flares to the US Department of Defense. The contract extends over a five year period and has a maximum value of US$804 million. First order for delivery in 2010 and Q1 2011 worth US$42 million has already been placed.

In the AIM, Africa operating gold and platinum miner Goldplat (AIM: GDP) announced the JORC-compliant resource for the Kilimapesa Hill gold mining project in Western Kenya, saying the Measured and Indicated resources totalled 409,000 tonnes at 2.39 g/t (grammes per tonne) for 31,416 ounces of gold. In addition, colonial tailings in the immideate vicinity of the plant have a combined Measured and Indicated resource of 41,000 tonnes at 2.56 g/t (grammes per tonne) for 3,400 ounces of gold.

Lesotho operating diamond miner Kopane Diamond Developments (AIM: KDD) announced a 60 days exclusivity agreement with a potential investor in the Liqhobong Main Pipe development project and said it planned to undertake further work to assess full value of Main Pipe grade after releasing a resource statement in September, showing a gross diamond reserve of 29.7 million carats at an average grade of 33 cpht (carats per hundred tonnes), which it says was the lowest estimate in a range of grade results possible in the Main Pipe, believing it could be increased.

Software manufacturer Synchronica (AIM: SYNC) announced yet another contract win for its mobile email and synchronisation products Mobile Gateway and Mobile Backup, this time with an operator in South-East Asia. The operator will pay a share of the net revenue from the provision of Mobile Gateway to the company with a minimum fee of US$1 per subscriber per annum and an additional US$0.5 per subscriber per annum. Synchronica will also provide professional services for customisation and deployments of the products worth US$60,000.

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