FTSE LIVE: London market lose earlier gains; Xstrata to give its view on Glencore’s latest offer

| September 21, 2012 | 0 Comments

By
This Is Money Reporters

02:45 EST, 21 September 2012


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09:06 EST, 21 September 2012

14:45: The UK blue chip index is 4.08 points lower at 5850.56 as trading continues to be volatile.

The European Commission has agreed to EMI’s £1.2billion takeover by Universal on condition it sells several of the company’s labels, following concerns over Universal gaining excessive market power. Read more here.

12:00:

Volatile trading saw the FTSE 100 slip into the red once more today, despite a defiant performance from Asian markets overnight, following the stock futures and options expiries.

Trading was impacted by the so-called ‘quadruple witching day’, where futures and options expire at the same time, which left the FTSE 100 Index 8.6 points lower at 5846 after rising more than 30 points at one stage.

The market was initially boosted by a bounce back in Asia in the face of yesterday’s weak figures on Japanese exports and Chinese manufacturing.
Futures trading also pointed to a higher opening on Wall Street thanks to expectations for a strong retail launch of Apple’s new iPhone 5 and on speculation that Spain could soon seek a full bail out from Europe.

‘As expiry goes through you’re seeing a bit of volatility, but you could
find that the market creeps back up again,’ Manoj Ladwa, head of
trading at TJ Markets, said.

New York-listed crude oil also rose back above $93 a barrel in a recovery from the big losses seen in recent days.
This helped nudge commodity-based stocks in the right direction, with Vedanta Resources up 26p at 1080p and Evraz 3.5p higher at 264.3p.

However it failed to provide a lift to oil giants, with BP down 2.2p to 442.3p as it reportedly said it was planning to use some of the proceeds from the potential sale of its stake in Russian joint venture TNK-BP to increase its share in the country’s oil group Rosneft.

Banking stocks were faring well, with Lloyds Banking Group up 0.4p to 39.8p, Royal Bank of Scotland ahead 2.5p to 271p and Barclays 0.1p stronger at 222.2p.

Pearson – the owner of the Financial Times newspaper – was another blue chip stock on the rise, up 17.5p to 1199.5p, after a broker upgrade, citing prospects for the group’s expanding education business.

August public borrowing figures published today showed no improvement on last year, piling pressure on George Osborne to abandon his deficit reduction target. Read more here.

Deal? The board of Xstrata is expected to give its view of Glencore's latest offer today

Deal? The board of Xstrata is expected to give its view of Glencore’s latest offer today

10:00:

The Footsie is 28.9 points higher, or 0.5 per cent, at 5,883.5.

Shares in HMV fell more than 4 per cent today after the troubled retailer said like-for-like sales fell 11.6 per cent in the 20 weeks to September 15. Read more here.

8:30:

The FTSE 100 has opened higher and is now trading 22.4 points higher, or 0.4 per cent, at 5,877, rallying after falls in the previous session in tandem with modest gains on Wall Street and in Asia, though trading could be volatile ahead of stock futures and options expiries.

The UK blue chip index closed down 33.84 points, or 0.6 per cent yesterday at 5,854.64 led by weakness in mining stocks after dull data in Europe, the United States, and China all painted a bleak picture of prospects for a rebound in economic activity.

Copper rallied today from a drop in the prior session, spurred by hopes for major economies to continue stimulus moves that could boost global demand for metals, although the metal is on course for a weekly fall, snapping two weeks of gains.

Brent crude rose towards $111 today as concerns about Libya’s precarious security situation and lower production in the North Sea triggered worries about supply.

Britain’s public sector finance numbers
for August will be released today, with net borrowing seen at
£13.30billion, compared with £12.55billion a year earlier.

Stocks to watch today include:

Centrica – After yesterday’s talk that Gazprom was interested in acquiring the UK gas provide was rebuffed by the Russian company, a few traders still reckoned that a bid, possibly from Qatar, was destined to materialise at around 500 pence-a-share for the UK company.

Xstrata, Glencore – The board of Xstrata is expected to give its view of Glencore’s latest offer within hours, sealing the fate of what would be mining’s biggest ever deal, the Daily Telegraph said.

BAE Systems – The management of the British defence giant has so far met with 600 head-office staff face-to-face to persuade them of the merits of its proposed £30billion merger with Airbus-owner EADS , the Independent said.

Royal Dutch Shell – The oil major on Thursday won approval for limited drilling in the Beaufort Sea off northern Alaska, allowing the British oil company to start one exploration well there while it pursues a separate prospect in the Chukchi Sea.

British Land – The property group has sold seven foodstores for a combined consideration of £118million.

Sage Group – The accounting software group said it has acquired two Brazilian businesses, EBS for a cash consideration of up to £10.6million, and Cenize for a cash consideration of up to £3.9million.

HMV Group – The firm said like-for-like retail sales declined by 11.6 per cent in the 20 weeks to Sept 15, and it has continued to experience significant market value declines in its core music, visual and games sales.

Lonmin – The world’s No. 3 platinum producer said on Thursday its wage bill would rise 14 per cent from October 1 because of a pay deal reached this week to end a violent 6-week strike.

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