FTSE close: C&W down, BP and the index up

By Reuters
Updated: 12:12 EDT, 6 September 2010

17.00 (close)

The FTSE 100 remained in positive territory for the seventh straight session today, but stocks trod water as US markets remained shut for the Labor Day holiday.

London's Footsie closed 11 points up at 5439.2, with markets across Europe also holding onto gains thanks to Friday's better-than-expected jobs figures in the United States.

Last week's US non-farm payrolls showed 54,000 jobs were lost over August against forecasts for more than 100,000, which sent the Footsie and Dow Jones Industrial Average in America up 1% on Friday.

Gains in Asia put the markets on the front foot again today, although America's Labor Day holiday limited the potential for a further advance in London.

In currency news, the pound fell across the board, slumping to a six week low against the euro on ongoing fears over the UK recovery.

Sterling fell to just under 1.20 euros and dropped 0.3% to 1.54 against the US dollar.

With Wall Street shut and little in the way of corporate news, market attention was focused on takeover rumours surrounding Cable & Wireless Worldwide.

Reports suggested Singapore's SingTel was lining up a buyout bid and had contacted bankers in Asia and Europe to discuss it.

However, shares in the telecoms firm C&W failed to hold on to the gains as the speculation fizzled out, leaving the group 0.2p lower to close at 72.75p.

Shares in Argos and Homebase owner Home Retail Group were 5.8p higher at 227.1p after broker Seymour Pierce upgraded the stock from sell to hold.

The retailer, which is due to post a trading update on Thursday, is in danger of relegation from the top flight when the latest reshuffle of the FTSE 100 Index takes place later this week.

Other blue-chip risers included oil giant BP after the US Government said the ruptured well in the Gulf of Mexico had been secured and no longer constituted a threat. Shares were 4.8p higher at 406.5p, a gain of more than 1%.

But drugs giant GlaxoSmithKline was in the red, down 19.5p to 1249p, as it faced UK regulatory calls to withdraw its under-fire diabetes drug Avandia over ongoing fears surrounding heart risk concerns.

Heavyweight miners joined Glaxo on the Footsie fallers board, with Kazakhmys down 17p to 1268p and Eurasian Natural Resources off 9.5p to 875.5p.

Elsewhere, five-a-side football group Goals Soccer Centres scored a 5% hike after a 5.5p increase to 121p as it reported an improvement in recent sales thanks to a World Cup bounce.

While sales dropped 3% in the first half of 2010, the group has seen a 3% rise since June.

The biggest Footsie risers were Home Retail Group up 5.8p to 227.1p, Tullow Oil ahead 26p to 1182p, BT Group up 3p to 140.6p and Capital Shopping Centres up 6.6p to 358.4p.

The biggest Footsie fallers were GlaxoSmithKline down 19.5p to 1249p, Icap off 6.7p to 431.9p, Autonomy down 27p to 1748p and Smith & Nephew down 8p to 548p.

14.00

The FTSE 100 is up 21.6 points at 5,449.8.

But drugs giant GlaxoSmithKline is in the red, down 18.5p to 1,250p, as it faces UK regulatory calls to withdraw its under-fire diabetes drug Avandia over ongoing fears surrounding heart risk concerns.

Banks and miners join Glaxo on the Footsie fallers board after gains last week, with Barclays down 2.1p to 322.9p and Asia-focused Standard Chartered off 11p to 1859.5p.

Elsewhere, five-a-side football group Goals Soccer Centres races 5% higher after a 6p increase to 121.5p as it reports an improvement in recent sales thanks to a World Cup bounce.

While sales dropped 3% in the first half of 2010, the group has seen a 3% rise since June.

12.00

Shares in Chariot Oil & Gas rise 17p to 136p after the oil and gas explorer upped prospective resources in its offshore Namibia fields by 1.5billion barrels.

Chariot also expects an increased chance of success across its Namibian prospect.

'[This] underlines the highly prospective nature of Chariot's licence position,' analyst Werner Riding of Ambrian Capital writes.

The analyst, who retains a 'buy' rating on the stock, is 'hopeful that a new farm-out deal can be successfully concluded before year end 2010.'

Shares in Fenner gain 8.8p to 219.5p, making the industrial conveyor belt maker one of the biggest risers on Britain's mid-cap index. It says it expects its full year results to be at the top end of its expectations.

Analysts at Brewin Dolphin, which rate the stock a 'buy', upgrade their 2010 and 2011 forecasts by 5% after what they call a strong statement.

'Perhaps the most striking number in the statement is net debt. It is expected to be less than 115 million pounds which is some 15 million pounds ahead of our expectations,' says the broker, adding that it believes the company will start to make acquisitions in the coming months.

The FTSE Small Cap index gains 0.1% in early trade.

Clapham House falls 3.1p to 67.4p after the restaurant operator says its weekly performance remains volatile on a tough UK trading environment and outlook, though August has shown signs of a return to the improved pre-World Cup sales trends.

10.30

The Footsie starts the week on the up as last week's job figures from the US continue to offer a boost to world markets.

London's blue-chip share index adds 23.2 points to 5,451.4 after rising 1% on Friday in the wake of the non-farm payrolls, which showed a lower-than-expected figure of 54,000 jobs lost over the month.

Asian markets are also higher, although analysts said the Labour Day holiday in America today will limit the potential for further gains in London.

Takeover speculation involving Cable & Wireless offered some interest to traders.

Shares in the telecoms firm are 6% or 4.25p higher at 77.2p after reports said SingTel had contacted bankers in Asia and Europe to discuss a possible bid.

'It looks like the takeover theme is continuing,' said Richard Hunter, head of UK Equities at Hargreaves Lansdown Stockbrokers.

'Sometimes there's no smoke without fire but by the same token corporate balance sheets in general are looking strong, so that's why we are seeing companies looking around at what they see as knock-down prices.'

Economy-sensitive banks were among the top gainers, up 0.5%, with Lloyds Banking Group up 0.2p to 72.9p.

Other blue-chip risers include oil giant BP after the US Government said the ruptured well in the Gulf of Mexico had been secured and no longer constituted a threat. Shares are 7.7p higher at 409.4, a gain of 2%.

Elsewhere, shares in Argos owner Home Retail Group are 3p higher at 224.3p after broker Seymour Pierce upgraded the stock from sell to hold.

The company, which is due to post a trading update on Thursday, is in danger of relegation from the top flight when the latest reshuffle of the FTSE 100 index takes place this week.

On the downside, Smith & Nephew, Europe's largest maker of replacement knees and hips, fell 6p to 550p after JP Morgan downgraded its growth forecasts for the firm.