London midday: Mining stocks in the driving seat

9th Jul 2009 12:17

Mining stocks are behind the wheel once again and today they are driving the market higher.Silver miner Fresnillo is the best performer after being upgraded to "buy" by Citigroup. In contrast the US bank had downgraded gold miner Randgold Resources to "hold" from "buy".Elsewhere in the sector Anglo American jumps on hopes that Xstrata will bow to institutional pressure and pay a premium for control of Anglo should it launch a bid.Among the sector's second liners Peter Hambro is wanted after Citigroup issued a "buy" note.Broker comment also lifts retailers Marks & Spencer and Home Retail, both of which have been raised to "buy" from "hold" by Citigroup. Car insurance group Admiral sails higher after Bank of America moved its stance from "hold" to "buy" but engineering IT systems provider Aveva hits the skids after Exane BNP cut the stock to "neutral" from "outperform" after Aveva said it has started to see the anticipated decline in initial licence sales in the marine sector.In corporate news, shares in Associated British Foodsfell after year-on-year growth slowed in the third quarter of its financial year. The group as a whole saw revenue rise 19% in the 40 weeks to 20 June, but growth slowed in the third quarter, with revenues rising just 15%. Housebuilder Barratt Developments said it remains cautious about the outlook and will continue to match work in progress to demand, whilst reducing debt and controlling costs. Fund manager Man Group reported a slight dip in assets under management in the first quarter as customers withdrew funds, but said it is well placed to grow market share. Funds under Management (FUM) at 30 June stood at $43.3bn compared with $44bn announced at end May (31 March: $46.8bn).Recruiter Hays said it has been another tough quarter with demand continuing to weaken in both its temporary and permanent placement businesses. In the quarter ended June 2009, the group saw a reduction in net fees of 37% (40% on a like-for-like basis) versus last year. Defence firm Cobham has won a $32m contract from the US Navy to provide low band transmitters. The firm will provide an additional 37 AN/ALQ-99 Low Band Transmitters (LBT) under Lot 2 of the programme's Full Rate Production (FRP) phase, as part of a modification to the existing Lansdale FRP Lot 1 contract.In a similar vein, Air New Zealand has placed an order with aero engine giant Rolls-Royce for Trent 1000 engines to power its Boeing 787-9 aircraft.Housebuilder Redrow said trading results are expected to be around the lower end of analysts expectation in light of the extreme trading conditions experienced in the year. The group legally completed 2,113 new homes in the 12 months ended 30 June 2009 (2008: 3,925), in line with its expectations. Housebuilder and contractor Galliford Try said results for the full year are expected to be in line with company forecasts as the pickup in the UK housing market continues.Online poker firm PartyGaming said revenue since 6 April has been in line with that achieved in the first quarter, though full-year distribution costs are expected to be slightly higher than forecast.Genus said it saw further weakness in the North American dairy market in the final quarter caused by low milk prices but still expects a strong increase in profits for the year to 30 June.The boards of property groups SEGRO and Brixton have agreed the terms of their merger, to be effected by an offer by SEGRO for Brixton.FTSE 100 - RisersFresnillo (FRES) 484.75p +9.55%Anglo American (AAL) 1,636.00p +4.64%Admiral Group (ADM) 897.00p +3.70%Legal & General Group (LGEN) 51.60p +3.66%FTSE 100 - FallersWolseley (WOS) 1,062.00p -2.30%Hammerson (HMSO) 279.00p -2.11%Cairn Energy (CNE) 2,095.00p -1.97%Smith & Nephew (SN.) 442.50p -1.50%