London Keeps Afloat, Miners Sank

Ivaylo
21 Dec, 2006
New York City

London

[R]9:30AM London market was virtually unchanged in early trade on Thursday.[/R]
The FTSE 100 shed 5.5 points at 6,193.1 in late morning trade trade.

Advancers

Financial stocks were upbeat. Old Mutual gained 1.6%, Alliance & Leicester advanced 1.3% and Royal & Sun Alliance edged higher 1%.

Housebuilders were also higher after Persimmon restated its numbers. Persimmon advanced 0.1%, Taylor Woodrow moved higher 2.5%, Berkeley Group added 2.2% to and Crest Nicholson rose 1.2%.

Decliners

Shares in Vodafone were under pressure as dealers took in reports of a potential multi-billion dollar bid offer for an Indian mobile operator. Vodafone plunged 2.40%.

Mining stocks sagged as metals prices weakened. Rio Tinto shed 1.2% and Kazakhmys dipped 0.9%.

British Energy, having conceded this week that repair work at two of its major power stations would keep them from operating under full capacity until March, shed 1% as it was downgraded to neutral from overweight by JP Morgan.

Burren Energy declined 4.3% as the death of Saparmurat Niyazov, president of the gas rich Central Asian republic of Turkmenistan, sparked fears over the exploration group’s assets there.

[R]7:30AM Asian markets in broad decline Thursday, despite the advance in Japan.[/R]
Asian markets fell broadly on Thursday. The Nikkei 225 stock index in Japan gained 0.22% to end at 17,047.83, its highest finish since May 9. Steelmakers advanced on reports that Nippon Steel was about to gain control of Usiminas of Brazil by acquiring a majority stake. Nippon Steel edged 0.5% higher and Kobe Steel added 0.51%.

Toyota Motor Corp advanced 1.7% while Honda rose 1.1%. Electronics and entertainment conglomerate Sony moved 0.2% up. Machinery-related shares advanced as well, boosted by hopes of strong capital expenditure on new factory investment. Komatsu Ltd. Gained 3.4% and industrial robot-maker Fanuc Ltd gained 1.3%.

In Hong Kong, the Hang Seng Index shed 0.1% to 19,222.84. Bank of China gained 1.6% and China Construction Bank also moved up 2.2%, but falls in HSBC and China Mobile weighed on the overall market. HSBC shed 0.3% and China Mobile slipped 0.3%.

Thursday, the Stock Exchange of Thailand benchmark SET index shed 2% to 676, with investors attributing the decline to profit-taking and concerns over a weaker Thai baht against the U.S. dollar that could trigger a selloff.

South Korean stocks also closed slightly lower on profit-taking in banking and telecommunications shares. The Korea Composite Stock Price Index, or Kospi, dropped 0.4% to 1436.47. Kookmin Bank was off 1.1% and Shinhan Financial Group lost 2.3%.

Malaysia KLSE Composite rose 0.2%. Singapore Straits Times Index added 0.3% and Taiwan Weighted Price index put up 0.4%. Other markets around the region included Australia S&P/ASX 200 shedding 0.3% and New Zealand NZX-50 moving 0.5% higher.

[R]6:30AM European stocks retreated slightly Thursday in thin trading.[/R]
European markets declined slightly in early trade on Thursday. The FTSE 100 in London was 0.1% lower at 6,188.9, Frankfurt Xetra Dax was down 0.1% at 6,582.24, while the CAC 40 in Paris was up fractionally at 5,516.44.

Advancers

Publicis Groupe, the French advertising company, advanced 4.7% following its announcement after the close on Wednesday that it was buying Digitas, the US interactive advertising agency, valuing the company at $1.3 billion.

French utility Suez traded 2% higher as it said its Belgian subsidiary Electrabel had increased its stake in Societe Hydro-Electrique du Midi in france from 40% to 99.6%.

Richemont, luxury goods group, gained after Swiss watch exports rose 13% yearly in November. Richemont moved up 3%.

Ryanair Holdings advanced 0.3% after it said that it is withdrawing its offer to buy Aer Lingus as the European Commission competition body announced it would open an investigation into the takeover bid. Aer Lingus shares gave up 0.4%.

Decliners

Vodafone Group shares dipped 1.4% on reports that of tabling a bid for Hutchison Essar at $13.5 billion. Shares in Sanofi-Aventis slipped 0.2% after its CEO told the a newspaper that the company would like to buy a biotech if one was available.

Oil and gold

Crude oil declined from a three-month high on talks that warmer-than-usual weather will reduce demand for heating fuel amid rising inventories. Crude oil for February delivery fell 56 cents, or 0.9%, to $63.16 in electronic trading on the New York Mercantile Exchange. Brent crude oil for February settlement fell as much as 62 cents to $62.61 a barrel in electronic trading on the ICE Futures exchange.

Gold gained in London as the dollar retreated against the euro, making some investors buy the metal as an alternative investment. Gold for immediate delivery in London rose $2.11, or 0.3%, to $622.55 an ounce.

Currencies

The U.S. dollar was mixed against other major currencies in European trading Thursday morning. The euro traded at $1.3172, down from $1.3178 late Wednesday. The British pound traded at $1.9682, up from $1.9644. The dollar bought 118.15 Japanese yen, down from 118.34.

[R]5:00AM Gold and silver fell Wednesday on short-covering before the holidays.[/R]
The top-traded February gold lost $1.10 to end at $624.30 an ounce while March silver moved 6.5 cents lower to close at $12.645 an ounce. January platinum gained $7.50 to finish at $1,126 an ounce while March palladium finished $1.50 lower at $327.75 an ounce. Most-active March copper declined 6.3 cents to end at $2.9545 per pound.

The front-month February crude oil contract advanced 26 cents to end at $63.72 a barrel. January heating oil gained 1.17 cents to finish at $1.7304 a gallon and January unleaded gasoline dipped 2.46 cents to end at $1.6759 a gallon. January natural gas slipped 31.4 cents to close at $6.769 a million British thermal units.

On the New York Board of Trade, December Arabica coffee futures gained 3.75 cents to end at $1.2675 a pound, with most active March up 3.70 cents at $1.2970. Futures on raw sugar in foreign ports for March declined 0.05 cent to finish at 11.99 cents a pound.