London midday: Pearson beats expectations

27th Jul 2009 12:07

Strong mining stocks are supporting the Footsie's quest to achieve a record breaking 12th successive day of gains today.Lonmin leads the mining sector higher after Goldman Sachs upgraded the stock to "neutral" from "sell". Kazakhmys and Antofagasta are the next best performers.Pearson remains the best performer on a much better than expected trading update. The publishing group upped its interim dividend as first half trading at its education division was better than expected, offsetting tough conditions for the FT and the adverse impact of currency movements.The UK's part-nationalised banks are also going well on hopes the upcoming results season will mirror the US banks, which produced plenty of pleasant surprises. Lloyds and Royal Bank of Scotland are both sharply higher, with the former getting an additional boost from Nomura, which has raised its rating on the stock from "reduce" to "buy". Rexam is proving to be a drag on the Footsie. The packaging group has confirmed that it is considering issuing equity to see it through the current difficult market conditions. In response to press speculation about a fundraising, Rexam, which makes cans and plastic packaging, said the risk of having its rating downgraded to sub investment grade had increased significantly. Bus and train group Stagecoach is in exclusive discussions with the bidder for National Express to acquire some of its businesses if the offer goes through. Reports at the weekend had suggested Stagecoach was looking to mount a rival bid to the offer from CVC and the Cosmen family, but it said today that while it was considering "all other options" it has started talks about buying certain businesses and assets of National Express if that offer is successful.Friends Provident has rejected another takeover proposal from Resolution and said it sees no basis for further engagement with the life insurance consolidator. Friends said it has received a revised proposal from Resolution yesterday but rejected it as the terms and structure of the proposal "remain wholly inadequate."A unit of drinks giant Diageo, East African Breweries Limited (EABL), is set to buy a "substantial" interest in Tanzania's second largest brewer. Lower fuel costs helped budget airline Ryanair report a better than expected first quarter profit. The Irish group saw net profit rise to €136.5m in the three month ended 30 June compared with €21m last year, but the shares lost altitude after the company warned that full-year profits will be at the lower end of the €200m to €300m range previously given due largely to lower fares. Revenue per passenger declined by 10%. British Airways and easyJet decline in sympathy ahead of their trading updates later this week. Building supplies group Wolseley has confirmed that trading conditions for the 11 months to June 30 continued at the depressed levels outlined in its May update, adding that it conditions will continue to deteriorate until the end of 2009.Gas and electricity pipeline grid operator National Grid said it is on track to deliver a strong performance in 2009/10.Profits plunged 55% at insurer Beazley during the first half due to currency exchange fluctuations. The UK mid-cap made £20.1m in the six months ended 30 June 2009, but that was way short of the £45m profit recorded a year earlier.Digital TV set-top box maker Pace tripled first half pre-tax profit and remains confident that it is on track to meet company expectations for the full year.African conglomerate Lonhro said the third quarter has seen continued growth in its core businesses despite the depressed global markets.Shares in software systems provider Total Systems tumbled after it warned order intake 'reduced significantly' during the first half and annual turnover is expected to be considerably less than the year before.FTSE 100 - RisersPearson (PSON) 665.00p +9.74%Lloyds Banking Group (LLOY) 81.35p +4.31%WPP Group (WPP) 467.50p +3.89%Lonmin (LMI) 1,289.00p +3.70%FTSE 100 - FallersRexam (REX) 289.50p -10.58%British Airways (BAY) 133.00p -2.85%Marks & Spencer Group (MKS) 330.25p -2.58%BT Group (BT.A) 112.60p -2.26%