UK Miners Drag Stocks Lower; Michael Page Drops

Mayank Mehta
17 Aug, 2009
New York City

UK stocks edged lower on global market weakness and a fall in commodities prices. Home sellers also lowered the asking price. Mining companies after commodities declined on weak China demand. The global recruitment agency Michael Page drops 5% after net plunged 52%.

[R]6:00PM London, 1:00 PM New York – UK stocks edged lower on global market weakness and a fall in commodities prices. Home sellers also lowered the asking price. Mining companies after commodities declined on weak China demand.[/R]

UK stocks fell on a weakness in global markets and decline in commodities prices. Selloff that started in China and Japan spread to the European markets after Japan reported weaker than expected rebound in the economy and China reported fall in copper imports.

In London FTSE 100 Index closed declined 79.08 or 1.6% to 4,634.89 and the pound closed at $1.63 and 1.15 euros.

UK home sellers lowered the asking price in August by 2.2% to £222,762 and prices in London dropped 3.8% according to the latest data from Rightmove Plc.

Commodities linked stocks fell sharply in Hong Kong, Australia, Canada, UK, Brazil and U.S.

Freeport McMoran Copper & Gold dropped nearly 7%, BHP Billiton dropped between 3% and 5% in New York, Sydney, London and New York, Xstrata dropped 5.5% in London and Vale S.A. declined 5.4% in New York and Sao Paolo, Brazil.

Energy related stocks also declined after crude oil futures edged lower. Exxon Mobil dropped 2.3%, BP Plc declined 1.4% in London, Total S.A. dropped 2.4% in Paris and Sunoco, Inc fell 4.3% in Toronto.

Gainers & Losers

Asia Digital Holdings PLC fell 9.4% to 0.430 pence after the online marketing group reported weaker than anticipated results despite improving sales in its Asian operations.

BTG plc sank 0.7% to 185.70 pence after the specialty pharmaceuticals company received regulatory approval to initiate a Phase I clinical study triggering a $7 million milestone payment from Onyx.

Fresnillo Plc decreased 3.4% to 549.50 pence after the primary silver producer said first-half revenues fell 10.7% to $378.9 million from $424.2 million a year ago. Net profit for the first-half fell 14.1% to $121.09 million or 16.9 cents per diluted share compared to net profit of $140.97 million 21.5 cents per share a year ago.

Hardy Oil and Gas plc lost 1.5% to 295.50 pence after the oil and gas explorer said first-half revenues fell 41.4% to $5.8 million from $9.9 million a year ago. Net loss for the first-half was $4.3 million or 6 cents per diluted share compared to net profit of $6.2 million 9 cents per share a year ago.

Heritage Oil Limited plunged 5.7% to 541.50 pence after the oil explorer announces the completion of testing the Miran West-1 discovery in the Kurdistan Region of Iraq. The company tested the flow of 3,640 barrels of oil a day and estimated between 8,000 and 10,000 flow a day in production.

Hill & Smith Holdings PLC advanced 4.0% to 260.00 pence after the highways infrastructure group said first-half revenues fell 7% to £196.8 million from £211.7 million a year ago. Net profit for the first-half rose 4.6% to £13.7 million or 18.0 pence per diluted share compared to net profit of £13.1 million 17.1 pence per share a year ago.

MGT Capital Investments, Inc advanced 2.0% to 0.510 pence after the developer of computer-aided detection and image analysis software said first-half revenues fell 11.7% to $121,000 from $137,000 a year ago. Net loss for the first-half was $3.8 million or 12 cents per diluted share compared to net loss of $5.1 million 14 cents per share a year ago.

Michael Page International plc decreased 5.3% to 303.40 pence after the recruitment consultancy said first-half revenues fell 27% to £364.7 million from £500.0 million a year ago. Net profit for the first-half fell 52% to £28.3 million or 8.7 pence per diluted share compared to net profit of £58.9 million 18.0 pence per share a year ago.

Morgan Sindall plc rose 1.1% to 605 pence after the construction and regeneration group was named one of two partners for £35 million regeneration scheme.

QinetiQ Group plc slid 1.9% to 130.90 pence after the defense contractor and Sodexo joint venture Metrix has been awarded a £31 million contract by the UK Ministry of Defence.

Red Rock Resources Plc added 17.7% to 1.33 pence after the mining exploration and mineral investment company is looking to acquire controlling stake in Kenya based Migori Gold Project.

Shaftesbury Plc declined 4.6% to 377.00 pence after the property firm said that office space demand is weak but the demand for retail and residential rental properties are holding up.

Hammerson Plc declined 3.3% to 390 pence on the market comments from Shaftsbury.

Venture Production Plc closed at 840.00 pence after the company announced the gas discovery in the East Irish Sea.

Witan Investment Trust plc fell 1.6% to 369.00 pence an investment company said first-half net loss was £9.95 million or 4.66 pence per diluted share compared to net loss of £140.50 million or 63.84 pence per share a year ago.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 7 increased, 94 declined and 1 were unchanged.

Anglo American Plc decliners in the FTSE 100 index with a loss of 5.55% followed by losses in Xstrata Plc of 5.48%, in London Stock Exchange Group Plc of 4.81%, in Rio Tinto Plc of 4.69%, in Thomas Cook Group Plc of 4.59%.

Shire Plc led gainers in the FTSE 100 index with a rise of 2.21% followed by increase in Legal & General Plc of 1.97%, in Aviva Plc of 1.61%, in GlaxoSmithKline Plc of 0.82%, in Wm Morrison Supermarkets Plc of 0.49%.

Europe Markets Review

In London FTSE 100 Index closed lower 68.96 or 1.46% to 4,645.01, in Paris CAC 40 Index decreased 75.58 or 2.16% to close at 3,419.69 and in Frankfurt DAX index lower 107.50 or 2.02% to close at 5,201.61. In Zurich trading SMI decreased 101.60 or 1.70% to close at 5,883.70.