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FTSE follows on from explosive move in the US

There was an air of relief this morning as Wall Street saw a surge of buying towards the close last night. The FTSE 100 index was up over 60 points mid-morning, with encouraging moves in the mining sector and other oversold issues. Xstrata steadied the market with a 47% rise in first-half net profits to $3bn, in line with forecasts. The group added that it expected a better operational performance in the remainder of the year, with strong demand from Asia. Although the shares were up a little, sector peers Antofagasta, Anglo American and Lonmin led the board.

Standard Life's said that first half sales rose by 31%, ahead of forecasts, with the life group also promising a significant increase in its margins, but of more interest was any news on whether it would join the battle over the merger between Resolution and Friends Provident. At the bottom of the list though was Scottish & Newcastle which said it that hitting its targets for the year would be very challenging due to poor weather in Western Europe.

On the second line, Pendragon reported lower pre-tax profit, but the group said current trading is in line with expectations despite the slowing car sales market. Inmarsat said that profits would come in higher than previously expected this year after a record second quarter. Bellway added that net pre-tax profit would be at a record level and in line with expectations for the year end. Finally, Mouchel Parkman said it had bought HBS for £46.24m, adding that trading for the year to 31 July had been in line with expectations.

Mike Estrey
Head of Research at Blue Index, the Online CFD Trading experts
07/08/2007

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