Thursday Morning Market Update: Oils and miners stand out in lacklustre markets

HBOS, Reed, Smiths and BAT all better after results, but BT and Unilever fall on disappointing news.

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by Phil Cozens on Jul 31, 2008 at 10:20

Firmer oil and mining shares lend support to otherwise lacklustre stock markets as a raft of important corporate trading statements dominate the action.

By 10am the FTSE 100 index was five points adrift at 5,417 and the Mid-250 index 12 points lower at 8,874.

Robust oils were led by Cairn Energy at £27.60, up 125p and Tullow, 29.5p higher at 773p, while among buoyant miners Kazakhmys stood out at £14.80, up 60p and Antofagasta rose 16.5p to 580p.

Better-than-expected trading updates continued to benefit HBOS at 281p, Reed Elsevier 565p, BAT £18.78 and Smiths Group, £10.42, up 6p to 21p and favourable news yesterday strengthened Admiral at 927.5p and Rexam 384p, up 14p and 3.5p..

BT Group shed 20p to 177.4p after unveiling a 17% profits shortfall and Unilever also disappointed as it moved into ex-growth territory, falling 110p to £14.

Next suffered a loss of 55p to 940.5p as SG Securities downgraded the stock to sell from hold with a reduced 800p target and Lloyds TSB fell 14.5p to 291.5p as several brokers turned negative after yesterday's disappointing 70% profits setback.

Cadbury also declined 22.5p to 597.5p on second thoughts about yesterday's figures and other prominent dull spots included Shire at 774.5p, Experian 383.5p, Schroders 964p, Smith & Nephew 544p and AstraZeneca £23.37, down 11.75p to 53p.

The latest jump in oil prices prompted renewed nervousness among high energy users, British Airways at 257.25p and Carnival £17.55, down 5.75p and 42p.

Telecity gave up 18.5p to 251.5p as Deutsche Bank placed 12 million shares in an accelerated offer and William Hill dipped 14.25p to 311.5p after producing figures in line with market estimates.

Sharply higher profits did little for Laird Group, 40p easier at 297p, and Greggs at £35.83, Mitie Group 219.75p, Rank Group 73p and Tomkins 127.75, declined 2p to 136p in response to their respective statements.

A 28% fall in gold production left Avocet Mining languishing 26.5p lower at 115.5p, but BowLeven jumped 29p to 352p following a significant oil find.

Randgold Resources climbed 151p to £25.06 after reporting doubled interim profits and a major discovery at its Massawa project.