Rio Tinto Powers FTSE

Ivaylo
18 Oct, 2001
New York City

Rising US futures following well received inflation figures gave London a boost at an intraday high ahead of the opening bell in U.S. Financial stocks and miners stood out. Man Group is in focus on reports that it has appointed investment bankers to advise on a demerger of Man Financial, its brokerage arm. Hanson is another strong performer as bid rumours emerge. The FTSE 100 advanced 35.5 points, or 0.6%, at 6,144.3, in mid-afternoon trading.

[R]9:30AM Financial amd mining stocks boost FTSE on Wednesday.[/R]
The FTSE 100 in London advanced 35.5 points, or 0.6%, at 6,144.3, in mid-afternoon trading on Wednesday.

Advancers

Rio Tinto was the early standout stock. Its shares gained 3%, following a strong third quarter production report. The rest of the sector tracked Rio higher. BHP Billiton gained 1.6%, while Vedanta added 1.6% higher and Antofagasta rose 1.4%.

Man Group was another stock, rising 3.3% supported by reports which claimed it had asked Merrill Lynch and Credit Suisse to work on a demerger of its brokerage arm, Man Financial. PartyGaming, was also up 4.8%, and among the best performers on reports of a bid from a Las Vegas gaming company.

British Energy continued to recover from the 25% fall on Monday. Shares in the generator, lifted by a spate of supportive comment from analysts and short sellers buying back their positions, gained a further 4.2%.

Rumoured takeover target Hanson advanced 3% as London reacted to news that the US homebuilders index had risen from 30 to 31 points in October. Along with Wolseley, 2.4% higher, Taylor Woodrow, 1% stronger, and George Wimpey, 1.5% stronger, Hanson is one of the UK stocks most exposed to US housing market trends.

Decliners

The top decliners included Reuters easing 1% after third-quarter results from the news and financial information group failed to trigger earnings upgrades from City analysts. International Power eased 1.5% as analysts denied Tuesday rumours of interest from RWE of Germany.

Corporate news

Cobra Electronics has entered an agreement to purchase Performance Products, a privately held, UK-based consumer electronics company for about 17 million pounds plus two earnout payments totaling 12.5 million pounds.

[R]7:30AM Asian markets end mostly higher, financials power Japan.[/R]
Asian markets ended mostly higher on Wednesday. Japan''s Nikkei 225 index gained 0.25% to finish at 16653.00. Toyota, which was down through most of the trading session following its recent sharp rally, ended up 0.3%. Toshiba advanced 2.8% after revising up its earnings outlook for the first half ended September. Aeon finished up 0.4% on last-minute bargain-hunting after trading in negative territory through most of the trading day.

In South Korea, gains in South Korean banking shares supported the local stock market to close up, despite concerns over North Korea. The Korea Composite Stock Price Index edged up 0.2% to 1354.26.

In Hong Kong, the Hang Seng Index gained 0.18% to end at 18048.09. In Taiwan, though, shares dropped slightly, pushed down by the food and electronics sectors. The Weighted Price Index of the Taiwan Stock Exchange shed 0.8% to 7017.6. Taiwan Semiconductor Manufacturing, the biggest contract chipmaker by revenue in the world, declined 1.4% and rival United Microelectronics dropped 1.9%.

[R]6:30AM European stocks rise in early trading Wednesday on tech stocks.[/R]
European markets were higher by mid-morning on Wednesday. The U.K. FTSE 100 index gained 0.6% at 6,144.40, Frankfurt Xetra Dax was up 0.5% at 6144.33 and CAC 40 in France was up 0.5% at 5330.73.

Advancers

Leading fine paper manufacturer, M-real rose 13% after the company tabled a cost cutting plan expected to save 100 million euros.

British Energy bounced back after a sharp fall earlier in the week and was up 3.7% as analysts said there was plenty of spare energy capacity for the coming winter despite problems at the company’s nuclear power stations.

Man Group was higher by 3.4% amid news it plans to demerge its brokerage, Man Financial. In mining stocks, BHP Billiton was up 1.1% and Rio Tinto was up 2.8% as analysts expect upbeat metals prices.

Decliners

Akzo Nobel declined 7% after the Dutch pharmaceutical group announced a delay loomed in launching its anti-schizophrenic drug, asenapine amid missing analysts quarterly earnings expectations. Dutch electronic chip maker, ASML sank 5%, despite reporting a record third quarter profit that exceeded forecasts.

Reuters plunged 1.6% as well after it reported third quarter results sightly better than forecasts. Collins Stewart cut Reuters to a hold from buy after the earnings release.

Oil and gold

Oil prices moved higher on Wednesday ahead of the release of weekly U.S. petroleum supply data expected to show a decline in distillate stocks. Light, sweet crude oil for November delivery rose 23 cents to $59.16 a barrel in on the NYME. December Brent crude oil on London ICE Futures exchange rose 33 cents to $61.27 a barrel.

Gold traded in London at $595.25 a troy ounce, up from $587.20 late Tuesday.

Currencies

The U.S. dollar was mixed against other major currencies in European trading on Wednesday morning. The euro was quoted at $1.2538, down from $1.2546 late Tuesday in New York. The British pound was quoted at $1.8699, down from $1.8704. The dollar bought 118.69 Japanese yen, down from 118.89.

[R]5:00 AM Gold prices fell below $600 an ounce on Tuesday on oil slump.[/R]
The most-active December gold declined $5.00 at $593.50 a troy ounce on the NYME. December silver settled 13 cents lower at $11.78 an ounce. January platinum moved $8.30 lower to settle at $1,083 an ounce and December palladium plunged $4.95 to close at $319.60 an ounce. The most-active December copper contract fell 8.50 cents to settle at $3.4960 per pound.

The November crude oil contract settled down $1.01 at $58.93 a barrel while the November heating oil sank 2.27 cents to finish at $1.7338 a gallon. November gasoline settled down 2.84 cents to $1.4633 a gallon. November natural gas lost 0.2 cent to end at $6.442 a million British thermal units.

On the New York Board of Trade, December Arabica coffee futures closed 0.55 cent higher at $1.0245 a pound, with March up 0.50 cent at $1.0640. Futures on raw sugar in foreign ports for March settled 87 points higher at 12.58 cents a pound.