Yesterday's trading: James Fisher on a roll
It says it all. When the biggest gainer among the top 250 Footsie stocks is in response to a measly £5.25m cash acquisition, you really do know the City is in peak holiday mode.
Geoff Foster: The FTSE 100 regained some composure after a two-day sell-off.
Hats off to specialist marine services group James Fisher that raced away to touch 505p before closing 37.5p, or 8.15%, higher at 498.5p following its purchase of MB Faber Ltd, which provides specialist electrical and engineering services to the nuclear and aerospace industries.
James Fisher, whose major 17.9% shareholder is solicitor Rowland Frederick Hart Jackson, has expanded from transportation of clean petroleum products to serve offshore oil, technical and defence sectors. It's paying off.
The acquisition of Faber, which has operations close to the Sellafield nuclear site in Cumbria, strengthens its nuclear decommissioning business, adding 120 specialist engineers to its nuclear worksforce.
Fisher has a successful acquisition strategy. The proof being in the pudding as acquisitions have accounted for almost 40% of the profit growth of the marine support services since 2002.
Analysts applauded yesterday's deal. Brewin Dolphin said it broadens the nuclear offering and suggests the opportunities in the nuclear area are starting to increase. Tuesday's interims should please.
Regaining some composure after a two-day sell-off which followed disappointing US consumer confidence data, the Footsie rallied 40.77 points to 4,685.78, while the FTSE 250 recovered 80 points to 8,354.48.
Wall Street bounced back with an early gain of 82 points despite news that US producer prices fell by a larger-than-expected amount in July. That was soon forgotten as a rise in single-family US home construction for a fifth straight month kept dealers' chins up and hopes alive that the world's largest economy was poised to recover from recession.
AMEC advanced 31.5p to 720.25p as fund managers piled in ahead of interim results due later this month. The group recently tied up the £52m earnings enhancing acquisition of Australian engineering services company GRD.
Still deemed to the most vulnerable and next takeover target in the insurance sector, Legal & General put on 2.8p to 70.05p. Clive Cowdery's Resolution (2p dearer at 86p) is still hungry even after swallowing Friends Provident for £1.86bn.
Europe's biggest bank HSBC climbed 18p to 655.5p after Goldman Sachs upgraded to buy from neutral and lifted its target price to 820p from 480p.Goldmans believes HSBC is 'highly geared to a global recovery due to the absence of significant drag from U.S. consumer credit losses'.
Xstrata regained 16p to 764.49 on a report that two major shareholders of Anglo American (10.5p dearer at 1830.5p) have said that there is no chance of a nil-premium merger between the two mining groups happening in the next 12 months.
Renewed selling amid continuing fears that a £500m rights issue is just around the corner left housebuilder Barratt Developments 8p cheaper at 224.92p.
Another day and another excellent set of figures from social housing and geriatric care group Mears, 6p lower on profit-taking at 266.25p. Operating profits for the half-year rose 18% to £120.8m and the dividend is up 19% to 1.60p. The order book stands at £1.8bn and the company is currently pursuing contracts worth £2.9bn.
Mears' mechanical and engineering division has won a contract to provide infrastructure and fit out works on the Athletes Village for the 2012 London Olympic Games. It comprises the first phase of the village with approximately 300 apartments valued at £9m. Follow up contracts on the site are expected. Investec's target price is 332p.
Highly speculative African Minerals, which is run by controversial Frank Timis of Regal Petroleum fame, was chased up to 326.25p on vague takeover talk before closing 4.75p better at 309p.
Returning from suspension after securing £6m of funding from BlueGold Capital Management, oil and gas explorer Dominion Petroleum gushed 1.125p to 7.5p.
Bioquell, which provides hydrogen vapour kits to hospitals designed to kill MRSA and other infections, rose 9p to 142p following strong half-year results. Revenue growth was better-than-expected thanks to a strong performance from its Bio-decontamination division. Last month it was reported that Department of Health trials at seven hospitals of Bioquell's RoboCleaner were going well.
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