FTSE in-depth: Rockhopper is still a slick stock
Investors buffeted by a thousand winds have struggled of late to squeeze profit from a capricious market.
Rich seam: Oil drilling group Rockhopper 'will see plenty of upside'.
With few clear themes emerging, most have been left to fend for themselves, but a few sub-sectors are providing rare illumination.
For energy independents drilling in coastal waters around the Falkland Islands, this has been a year that just keeps on giving.
Take Rockhopper, an AIM-listed oil company whose shares were, until early May, languishing below 40p. They now shoot up (and occasionally back down again) on a regular basis. News that Rockhopper's Sea Lion 1 well was set to be a bona fide hit gave its shares another boost, pushing them up 52p to 472p. Flow tests, at considerably more than 2,000 barrels a day, are in line with management expectations.
With evolution securities analyst David Farrell stating that flow rates of 10,000 barrels a day are achievable, the brokerage took the chance to upgrade Rockhopper to add from neutral.
Other analysts are even more bullish on the stock. Merrill Lynch analyst Alejandro Demichelis upped his price target on Rockhopper by 50p to 700p to reflect 'commercial de-risking' on a well holding up to 669m barrels of recoverable oil. '[the] sea Lion find… has transformed Rockhopper but we still see plenty of upside,' said Demichelis.
Rival Desire Petroleum saw its shares sag slightly, ending down 3.25p at 150.25p after hitting an all-time high on Friday. Evolution's Farrell noted that Desire's upcoming drilling campaign, widely expected to be a success, was already built into the stock. He downgraded the stock to add from buy, with a 136p target price.
But evolution cautioned investors to hold onto their shares, noting that Desire's Rachel prospect, described by Farrell as a 'Sea Lion look-a-like', could hand the stock a future value of around 550p. Another oil minor, Gulf Keystone Petroleum, also had a good day, surging by nearly 15% on rumours that the Kurdistan and Algeria-focused explorer was mulling a move to London's main board in early 2011.
The move would likely see Gulf Keystone (up 20.5p to 157.5p and described by one analyst as 'one of those genuinely risky buys that could make you an awful lot of money') raise more cash as well as entering the FTSE 250.
The Footsie itself had a solid day, closing up 94.09 points at 5602.54p - the first time it has closed above 5600 points since the end of April - as investors sought refuge in defensive plays. Cillit Bang maker Reckitt Benckiser saw its shares jump 105p to 3500p while Anglo-Dutch consumer goods rival Unilever, an immovable stock at the best of times, rose 53p to 1803p.
Major food retailers also had a solid day as investors fled to consumer-related plays. Tesco jumped 8.85p to 437.5p, while Morrison rose 7.5p to 306.3p as investors across the board sought sanctuary in secure investment structures.
BP finally shed the planet-sized monkey clinging unpleasantly to its back after finally killing the Gulf oil well that has given it so many summer headaches. Investors rewarded the firm, sending its shares up 8.3p to 411.35p. Shell jumped too, ending the session 39.5p higher at 1903p.
Miners had a steady day. Rio Tinto ended up 46.5p at 3604p. BHP Billiton, whose elongated £25bn pursuit of Canada's PotashCorp continues to trundle along, closed 40p higher at 1980p. Xstrata gained 24p to 1191p, with Kazakhmys edging 14p higher to 1402p.
Takeover talk provided a welcome diversion. Testing services company Intertek Group led the market risers for much of the day, ending 65p higher at 1853p on rumours of a potential takeover by Swiss rival SGS.
Seymour Pierce took the chance to raise its target price on the firm to 2000p and upgrade its rating to outperform from hold.
Panmure Gordon meanwhile upgraded its rating on recruiter Hays (down 3p to 112.6p) to buy from hold in the light of 'increasing bid speculation' from the likes of Adecco and Randstad, raising its target price to 135p.
Another, rather less convincing rumour focused on a potential Us-led deal for price comparison website Moneysupermarket.com (up 3.35p at 86.85p). An unnamed American private equity firm and a company connected to US media mogul Barry Diller are rumoured to be lining up a bid at 140p a share but one analyst dismissed the talk as '99.9% hot air'.
A few unfortunate companies saw their shares track down in a rising market. TUI Travel ended down 1.2p at 220.5p, hit by ongoing fears over the strength of the travel market.
Resolution also had a poor day, closing 4p off at 243.2p, while power provider Aggreko saw its shares tumble 23p to 1590p.
Most watched Money videos
- BMW's Vision Neue Klasse X unveils its sports activity vehicle future
- Mini celebrates the release of brand new all-electric car Mini Aceman
- Skoda reveals Skoda Epiq as part of an all-electric car portfolio
- BMW meets Swarovski and releases BMW i7 Crystal Headlights Iconic Glow
- Mail Online takes a tour of Gatwick's modern EV charging station
- 2025 Aston Martin DBX707: More luxury but comes with a higher price
- How to invest for income and growth: SAINTS' James Dow
- MailOnline asks Lexie Limitless 5 quick fire EV road trip questions
- 'Now even better': Nissan Qashqai gets a facelift for 2024 version
- Tesla unveils new Model 3 Performance - it's the fastest ever!
- Mercedes has finally unveiled its new electric G-Class
- Land Rover unveil newest all-electric Range Rover SUV
- Former Chancellor Nadhim Zahawi to chair Very Group
- BUSINESS LIVE: Nadhim Zahawi to chair The Very Group;...
- How reliable are the most popular used cars? Here's how...
- Reckitt Benckiser under the cosh over baby formula, says...
- Cerillion boosted by $11.1m contract with provider of...
- UK Government sells another chunk of NatWest shares
- Diploma shares top FTSE 100 risers after firm raises...
- A MILLION more people have taken on mortgages they will...
- Used car marketplace Cazoo looking for buyers as it nears...
- Evri issues warning over huge rise in smishing scams -...
- I repeatedly bail out my partner from his financial...
- Phoenix Group finance chief to step down from insurer
- Business leaders call for flagship scheme to get young...
- Stock market given a shot in the arm as Raspberry Pi and...
- Recruitment in private sector falls for tenth month in a row
- Don't try to be a super woman - build a dream team! The...
- The plant that can add £10,000 to the value of your home...
- New drivers face six-month graduate licences as new bill...