London afternoon: Equities continue winning streak

15th Jul 2009 14:52

London is on the rise for the third day in a row, a winning steak not previously seen this month. Resource stocks and insurers lead the way.Insurer RSA to being talked of as a takeover target, with Italy's life assurance group Generali touted as the likely predator. Elsewhere in the sector Prudential and Legal & General move higher as investors cover their bets in case a new wave of consolidation is underway. Fund managers F&C Asset and Henderson are also in demand on sector consolidation hopes.Miners are also in favour, with Xstrata, Kazakhmys and Fresnillo leading the way. Oil stocks also attract buying interest with Tullow Oil and BP the favoured stocks; the former has received formal approval from the Minister of Energy in Ghana for the Phase 1 Development Plan of the UK firm's Jubilee field.Rio Tinto is also up even though it revealed "difficult" conditions at its aluminium business during the second quarter, with production there down 5% on the same time last year. The row with China over the arrest of four of its employees is also becoming serious, with the Australian PM now involved.Land Securities is going well after it said it is beginning to assess acquisition opportunities and is in the process of firming up plans for a start during 2010 on two major London West End developments at Park House, W1, and Selborne House, SW1.The property giant, which raised £756m in a March rights issue to rebuild its balance sheet after huge write-downs, says growing investor interest is now evident for both prime and mid-quality properties.Production jumped 19% at Hochschild during the second quarter, putting the Latin America-focused miner "firmly on track" to hit its full year production target of 28 million silver equivalent ounces.Pub group JD Wetherspoon said like-for-like sales in the 50 weeks to July increased 1.2% and that it is "optimistic" about prospects for the new year. In the period to period to 12 July, overall sales rose 5.2% thanks to an encouraging sales performance from both its existing pubs and new openings. Q4 lfl sales fell 0.8% and total sales 3.1%.London Stock Exchange's revenues rallied quarter on quarter in the three months to June, but are still running well below levels seen last year. Against a strong prior year comparative quarter, revenue in first quarter fell 8% to £161.9m and by 12% on a constant currency basis. But revenue was up by 5% and by 7% respectively compared with the previous three months.Interdealer broker ICAP expects underlying profit for the year to March 2010 to be in line with expectations, providing exchange rates remain at current levels for the remainder of the year. Revenue grew by over 10% in the quarter ended 30 June 2009 compared with the same period in the previous year.Higher prices and better volumes kept Northern Foods on track in the first quarter with the hot weather giving its sandwiches and salads arm a seasonal lift. Underlying revenue for the first quarter to June grew by 5.5% on this time last year, reflecting price increases of 1.3% and volumes ahead by 4.2%.Luxury fashion group Burberry revealed an 8% rise in first quarter sales and said it has made a solid start to the year despite continued challenges in the retail industry.Social housing firm Connaught has made a £13.3m recommended offer for environment services firm Fountains. The group, which said today that it was confident of delivering full-year results in line with expectations, also confirmed it is in final negotiations to acquire two compliance services businesses.Outdoor clothing retailer Blacks Leisure said like for like sales at its stores open over a year fell 1.8% in the 19 weeks to 11 July 2009. This represents a deterioration from the position announced on 29 May, when the company said sales for the 12 weeks to 23 May were down by only 0.5% on a like for like basis.Confectionery retailer Thorntons said overall sales in the fourth quarter fell 2.7% to £27.9m after hot weather in June put off customers with a sweet tooth.