London open: Blue chips head lower

8th Dec 2010 08:57

London has opened lower as a bullish mood in the US following a two-year extension to tax cuts faded by the close last night.Smith & Nephew is the best performer by some distance, while Royal Dutch Shell is also higher after an upgrade to equal-weight from underweight from Morgan Stanley.The deal to sell a big chunk of the company's stake in Australian exploration group Woodside "indicated a ruthlessness we have not previously seen," the broker said.Contractor and support services specialist Carillion expects good growth in underlying profits this year despite tough market conditions in the UK. Profit growth should more than offset the effects of selling non-core businesses and stakes in Public Private Partnership (PPP) projects in 2009, which chipped in £17m last time.Stagecoach delivered a 44% hike in half-year underlying profit, with contributions from all businesses, and the bus and rail group is on track for the full-year following a good start to the second half. Profit before tax for the six months ended 31 October, excluding exceptional items, rose from £75.5m to £108.7m.Scottish soft drinks maker AG Barr's quarterly revenue increased 6.4% from the year before and it remains confident of achieving full-year targets. "Current trading remains in line with our expectations despite a very competitive environment," the drinks maker, best known for its Irn Bru and Tizer brands, said.Business software maker Micro Focus posted a sharp increase in half year profit and said company expectations for the full year remain unchanged. Pre-tax profit jumped to $63.2m in the half year to 31 October 2010 from $38.8m the year before. Total group revenue was up 8.7% to $215.6m.Kesa Electricals, one of Britain's largest consumer electronics retailers, raised interim underlying profit by more than half thanks mostly to growth at its French business. The owner of Comet in the UK and Darty France posted an adjusted profit before tax of €25m for the six months ended 31 October, up 52.4% from last year's €16.4m and at the top of the range of analysts' expectations. Computer games retailer Game's margins this year will be down by between 1.6-1.9 percentage points due to the ferocious competition in the games and consoles market. Game is also still wary over Christmas trading despite good demand for new blockbuster games and Microsoft's Kinect console.Property investment firm Helical Bar is raising money to fund "new compelling opportunities" in the real estate sector. The company, which received £28m from a placing in January 2009, has decided to sell up to 10.73m shares, worth almost £30m at last night's closing price of 277p. Gift wrap and stationery supplier International Greetings more than doubled half year profit while sales rose 13% as it moves confidently into the key Christmas period. Trading has continued in line with expectations since the period end, the group said in a company statement.