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Credit market fears lead to early rout in London again

Yesterday’s jitters on world markets resulting from the problems at BNP Paribas led to another heavy markdown in London, with the FTSE 100 index down over 100 points. The financial sector was hit hard with Man Group and Standard Chartered amongst a raft of big fallers on rumours that Man would delay the public offering of one of its hedge funds, while Standard is thought to be interested in South African bank Nedbank.

In the only blue chip results today, Old Mutual, which actually has a majority stake in Nedbank, saw operating profit on an EEV basis 12% lower at £782m, slightly below market forecasts and the shares dropped 1.85 with the market.

There were also falls in the mining sector with copper plays Antofagasta and Kazakhmys continuing their drops from yesterday for a total loss over two sessions of around 8% as copper prices weakened.

In other news, oil and gas company BowLeven said it had abandoned its IF-1 well offshore of Cameroon but said the overall acreage may still hold gas. Telecom Plus said trading for the year to date had been positive and it remained confident of reporting satisfactory results for the full year. InTechnology said trading was in line with expectations after the successful UK launch of its “Push To Talk” technology in July.

Mike Estrey
Head of Research at Blue Index, specialists in trading Contracts For Difference
10/08/2007

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