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London close: Footsie makes good gains

Date: Thursday 03 Jun 2010

London close: Footsie makes good gains

London closed healthily in the blue though off its best for the day as light profit taking towards the close pulled back some of the early gains.

Exploration tiddlers Nautical Petroleum and EnCore Oil caused some late excitement as their shares went stratospheric after a strike at the Catcher exploration well in UK Central North Sea block 28/9.

Nautical almost quadrupled in value, while EnCore doubled after they said the well had encountered excellent quality oil bearing reservoir sandstones at 4,600ft. Both the quality of the oil and the reservoir quality beat pre-drill expectations.

“The Catcher East sidetrack could add significant upside and there are multiple similar structures on the block. This is a superb result," said Steve Jenkins, boss of Nautical, which has a 15% interest in the well.

Alan Booth, head of EnCore, operator of the licence with a 15% interest, called it an “outstanding” result, while Simon Lockett at Premier Oil, with a 35% interest, said it was “an important new discovery” and upgraded its gross reserves estimate for Catcher to 25-50 million barrels of oil.

At the other end of the oil spectrum, BP’s share price was largely unfazed by the decision by ratings agency Fitch to downgrade the oil giant’s credit rating one notch to AA. Other oil related stocks such as Petrofac and Cairn also claw back some recent losses.

BP has agreed to fund the six sections of the Louisiana barrier islands proposal, which is estimated to cost the oil explorer $360m. The group will not manage or contract directly for the construction of the island sections and said it will not assume any liability for unintended consequences of the project.

Gains for the miners were fuelled by a rebound in copper prices. Eurasian Natural Resources, Kazakhmys, Rio Tinto and Vedanta are the picks of the sector. Gold miner Randgold is the exception.

Anglo-Swiss miner Xstrata has suspended A$586m of expenditure on Australian projects, saying neither will be viable under the government's proposed tax on super profits.

Chip-maker ARM enjoyed ahandy gain after industry analyst group Gartner predicted global chip sales will grow 27% this year compared to 2009. CML, Imagination Technologies and CSR also picked up.

DIY retailer Kingfisher, which owns the B&Q chain in the UK, reported a 1.8% decline in like for like (LFL) sales in the first quarter in which adverse weather conditions across Europe and ongoing economic uncertainty impacted consumer demand.

The recovery in platinum prices last year came slightly too late for Johnson Matthey, which refines the precious metal, to post a rise in profits or revenues in the year to March 31

AstraZeneca's biologics unit MedImmune suffered a setback today after the US Food & Drug Administration (FDA) voted against approving motavizumab to prevent serious respiratory syncytial virus (RSV) disease in high-risk infants.

Synergy Health, which provides outsourced support services to the health industry, posted a 50% rise in profits and said it starts the new year in a “strong position.”

Cancer drug developer Antisoma’s Leukaemia treatment AS1413 has been granted Fast Track designation by the US Food and Drug Administration (FDA).

Property firm Helical Bar swung into an annual pre-tax profit and increased its dividend as the value of its investment properties rose.

Property investor Quintain Estates said full year pre-tax losses narrowed as the value of its assets fell 1.5%.

Cellcast, provider of interactive TV programming, swung into losses as it continued to invest in additional distribution channels on Freesat and Freeview.

Real Good Food Company reports a very good start to its financial year with results in the first four months of the current year are above expectations.

Shares in Vantis fell back after the accountant said it is considering a number of courses of action to reduce its debt levels. These include negotiations with potential investors and preliminary discussions with debt providers about a potential restructuring of the company balance sheet.

Recruiter Empresaria expects full year profits to be materially ahead of current market expectations.

FTSE 100 - Risers
Petrofac Ltd. (PFC) 1,199.00p +5.18%
ARM Holdings (ARM) 267.90p +4.98%
Eurasian Natural Resources (ENRC) 1,031.00p +4.30%
Aviva (AV.) 339.10p +4.05%

FTSE 100 - Fallers
Randgold Resources (RRS) 5,975.00p -2.53%
BHP Billiton (BLT) 1,839.50p -0.89%
Xstrata (XTA) 985.50p -0.66%
BAE Systems (BA.) 324.20p -0.43%
3i Group (III) 289.30p -0.34%

FTSE 250 - Risers
Game Group (GMG) 99.50p +6.87%
Premier Oil (PMO) 1,198.00p +6.02%
Senior (SNR) 127.80p +5.10%
Lamprell (LAM) 206.10p +5.05%

FTSE 250 - Fallers
BlueBay Asset Management (BBAY) 303.00p -4.17%
PZ Cussons (PZC) 291.60p -2.80%
DSG International (DSGI) 25.50p -1.73%
Afren (AFR) 90.50p -1.58%

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