London close: Footsie flat ahead of FOMC minutes, Glencore up

11th Jul 2012 17:06

- Investors await FOMC minutes- BarCap cuts US growth estimates- Burberry disappoints; 'Glenstrata' in demand- Some say Glencore could benefit from rising grain prices The Footsie had pared early losses to trade broadly flat by the close as markets remained cautious ahead of the release of minutes of the latest Federal Open Market Committee (FOMC) meeting - investors are hoping for details that may hint at additional stimulus measures."Last month, the Fed opted to expand 'Operation Twist', dashing the markets hopes for more quantitative easing. Today, we will get a chance to understand what went on behind the scenes at the Fed, and if the central bank will follow other major peers and turn aggressive on policies," said market strategist Ishaq Siddiqi from ETX Capital this morning. In other news from across the pond, Barclays Capital has cut its 2012 US gross domestic product (GDP) growth forecast from 2.5% to 1.5%, with the investment bank saying that real consumer spending looks to have slowed to 1.7% in the second quarter, down from 2.5% in the first three months of the year. A court hearing in Germany began yesterday attempting to decide whether the European Stability Mechanism (ESM), the EU's permanent bailout fund, abides by German law. "A considerable postponement of the ESM, which was foreseen for July this year, could cause considerable further uncertainty on markets beyond Germany and a substantial loss of trust in the eurozone's ability to make necessary decisions in an appropriate timeframe," according to Finance Minister Wolfgang Schauble. FTSE 100: Xstrata, Glencore rise after merger vote delayed; Burberry tanksPotential merger partners Xstrata and Glencore International were the best performers of the day on the Footsie after the former announced this morning that it is pushing back its shareholder vote on the tie-up until September. The group said that since May, Australian regulators have approved the transaction and the US Department of Justice has allowed the waiting period to expire without taking action. As an aside, some references were heard today in the market to the effect that Glencore might benefit from rising grain prices given its recent acquisitions in the space. Luxury brand Burberry dropped over 8% after underlying sales growth slowed down from 15% in the fourth quarter to 11% in the first quarter. Analysts were expecting a 13% increase. Both Nomura and Bank of America Merrill Lynch cut their target prices for the stock today. Power systems group Rolls-Royce, which makes engines for Airbus, was under pressure after the European aircraft maker dropped its target of selling 30 A380 superjumbo jets in 2012 on the back of weak demand.Banking group Barclays was lower on reports that it has lost a major five-year Japanese bond deal "because of reasons related to reputational and counterparty risk issues," according to one source cited by Reuters. The news agency said that the deal could have reached $1bn in bond sales and so Barclays will lose out on a "hefty sum in fees".Chemicals peers Croda International and Johnson Matthey were out of favour after UBS downgraded its ratings on both stocks to 'neutral'. Banking group Lloyds was suffering from a ratings cut by Liberum Capital to 'sell'. Utilities peers Centrica and SSE were heavy fallers after Morgan Stanley downgraded the stocks to 'equal weight' and 'underweight', respectively. In contrast, insurance firm Aviva was benefiting after the US broker upgraded its rating to 'overweight'. Interdealer broker ICAP advanced despite saying that profits were down in the first quarter and trading volumes would remain subdued for at least the next few months. The stock has experienced a sharp fall over the last four months though. FTSE 250: Britvic hammered by recall and weather Soft drinks group Britvic plummeted after saying the recall of its Robinsons Fruit Shoot and Fruit Shoot Hydro drinks could cost thecompany up to £25m. Added to this, poor weather conditions and weak consumer sentiment means the group now expects to delivera full-year results at the bottom end of market expectations - before taking account of the impact of the recall. Panmure Gordon downgraded the stock to 'sell' this morning. Pub chain JD Wetherspoon rose after announcing that it had been boosted by strong trading around the fortnight of the Jubilee celebrations and during the Euro 2012 championships. Sector peer Spirit Pub jumped 10% today.FTSE 100 - RisersGlencore International (GLEN) 316.30p +1.85%ARM Holdings (ARM) 488.00p +1.56%Aviva (AV.) 290.80p +1.54%Xstrata (XTA) 839.00p +1.51%Evraz (EVR) 250.00p +1.50%Vodafone Group (VOD) 184.05p +1.32%ICAP (IAP) 314.80p +1.19%National Grid (NG.) 691.00p +1.17%Resolution Ltd. (RSL) 208.90p +1.02%CRH (CRH) 1,193.00p +1.02%FTSE 100 - FallersBurberry Group (BRBY) 1,189.00p -7.40%Polymetal International (POLY) 834.00p -4.90%Aggreko (AGK) 1,993.00p -4.27%Weir Group (WEIR) 1,516.00p -3.99%Johnson Matthey (JMAT) 2,103.00p -2.95%Marks & Spencer Group (MKS) 318.20p -2.93%WPP (WPP) 784.50p -2.91%GKN (GKN) 210.00p -2.55%Rolls-Royce Holdings (RR.) 867.50p -2.53%Fresnillo (FRES) 1,448.00p -2.43%FTSE 250 - RisersSpirit Pub Company (SPRT) 51.75p +9.52%Salamander Energy (SMDR) 179.80p +6.01%Aquarius Platinum Ltd. (AQP) 42.04p +4.58%Grainger (GRI) 92.65p +4.10%Ruspetro (RPO) 133.30p +4.06%Wetherspoon (J.D.) (JDW) 437.90p +3.84%BH Global Ltd. USD Shares (BHGU) 11.5 +3.51%Bumi (BUMI) 318.40p +3.38%Daejan Holdings (DJAN) 2,811.00p +2.22%Rathbone Brothers (RAT) 1,350.00p +1.89%FTSE 250 - FallersBritvic (BVIC) 260.10p -13.36%FirstGroup (FGP) 190.00p -7.04%Senior (SNR) 183.00p -5.62%Bodycote (BOY) 325.40p -5.16%Hochschild Mining (HOC) 442.60p -4.61%Yule Catto & Co (YULC) 127.40p -4.57%Halfords Group (HFD) 189.40p -4.34%BBA Aviation (BBA) 188.10p -4.32%ITE Group (ITE) 192.80p -4.27%Ashtead Group (AHT) 255.30p -4.13%BC