Yesterday's trading: Rolet's challenge at LSE
Frenchman Xavier Rolet will have it all to do at the London Stock Exchange when he takes over as chief executive from Dame Clara Furse in May.
Moving day: All yesterday's big movers
The former veteran Goldman Sachs and Lehman Bros trader will join as the LSE faces the most serious challenge to its business in its 208-year history, amid a collapse in the value of stocks traded, competition from upstart trading platforms such as Chi-X and Turquoise and threats to its lucrative market data services.
LSE shares were sold down to a year's low of 412p yesterday and closed 1¼p cheaper at 428p as dealers heard worrying reports that its share of UK trading had slipped below 60% for the first time ever in January.
There can be no doubt that competition is getting fiercer as investors grapple with the recession and try and find a cheaper way to trade.
Chi-X and Turquoise are making big inroads into the LSE's space as is Simon Brickles' Plus Markets (⅛p easier at 4⅞p) which is also making its presence felt.
Bulls believe Rolet should make a considerable difference at the LSE. He brings to the job knowledge of trading desks, technology and derivatives with a track record of building good relations with exchanges after spending the past 20 years dealing with exchanges while running operations at Goldman, Lehman and Dresdner Kleinwort.
Rallying from an intra-day six-year low of 3772.45, the Footsie closed 34.29 points easier at 3816.44. It took heart from an early 126-point recovery on Wall Street after JP Morgan Chase, America's second-biggest bank, said that its first quarter will be 'solidly profitable' at the same time it slashed its dividend by 87%.
Federal Reserve chairman Ben Bernanke also told Congress 'to fix banks first and economic growth will follow'. He warned that the US economy is in a 'severe recession' and said it may last until 2010.
Worries over corporate bond defaults continued to hold insurers in a vice-like grip. Sellers were all over the sector like a rash again as Friends Provident slumped 7.4p to 67.8p, Prudential 22p to 266¾p and Aviva 14½p to 272p. Legal & General cheapened 1.4p to 35.2p.
Dull miners featured Randgold Resources, 154p down at 3188p.
Vague takeover rumours helped Tullow Oil gush 19½p to 705½p. Annual results for 2008 will be announced on March 11. In 2008, production averaged 66,600 barrels of oil per day which is 9% lower than 2007. For 2009, analysts expect production to show a further decline to 60,000.
Reports of a pending circular on the online gaming industry helped 888 Holdings rise 9½p to 106½p and PartyGaming add 12p at 192p.
Chemicals company Elementis crashed 8¼p to 33¼p after warning it has to cut costs because market conditions in the latter half of the fourth quarter deteriorated significantly and trading in the early part of 2009 has not yet recovered.
Max Petroleum gushed 0.9p to 5.65p after revealing it has doubled its credit line with Macquarie Bank to $100m and intends to use the cash to fund the evaluation of data from prospects at blocks A and E at its assets in Kazakhstan.
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Buyers lifted GW Pharmaceuticals 6¼p higher to 44p after it reported positive results for a small study of lead cannabis-based drug Sativex, ahead of the publication of full results from a pivotal trial later this quarter.
CustomVis, the maker of next generation surgical eye lasers, jumped 0.55p to 1.05p on hefty turnover of 15m shares. Speculators piled in after hearing that Simon Gordon, an ex-board member, has increased his stake in the company to 3.33%. Word is he will continue to add to his holding prior to launching a full-scale bid.
NetPlay TV gained ¾p to 18¾p after tying up an exclusive deal with Channel Five to launch Eurotelmillions.com, which will feature five fixed-draw odds each week for a guaranteed payout from Monday to Thursday, and a jackpot of £10m each Friday.
Dana Petroleum rose 22p to 956p following news of its oil discovery at south east Rinnes, the third oil field discovered in the Rinnes area, in the northern North Sea. Bank of America/Merrill Lynch is bullish as it believes Dana's exploration story has further to go.
A positive trading update helped Empyrean Energy improve 0.6p at 8p. The A-3 and A-4 wells at the group's Sugarloaf Prospect in Texas have been placed on production and will produce 460 barrels per day.
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