London open: Early falls for blue chips

26th Nov 2010 08:47

Losses in Asia, a lack of direction from Wall Street, where traders sat out Thursday's session for Thanksgiving, and little company news have made for a dull start.Power companies are the main point of interest after Ofgem launched a new investigation after fresh data revealed a sharp increase in profit margins for the 'big six' suppliers. The industry watchdog said the net margin on a standard dual fuel tariff customer has risen 38% from £65 in September to around £90 now. This includes the recent price hikes just announced by Scottish Power, British Gas and Scottish and Southern. Demand for some metals will double over the next 15-20 years and Rio Tinto, already "very well positioned" to take advantage, is spending billions on expansion just to make sure. The company said in a statement ahead of today's annual investor seminar that capital spending will probably be around US$13bn in the 18 months to December 2011, including $4bn this year and about $11bn in 2011. Mined copper production for 2010 is expected to be 661,000 tonnes.Weir Group and BT are the best of the risers.Infrastructure specialist Balfour Beatty has reached agreement with the trustees of the company's pension fund to tackle the company's £375m pension fund deficit. The company and the fund's trustees have agreed a level of contributions which should see the deficit wiped out over a period of eight years, if events go as planned. The contributions will kick off with a one-off payment by Balfour Beatty of £40m, equivalent to £29m after tax, at the end of this year. Thereafter, annual deficit contributions of £48m (around £35m after tax) will be made, with effect from 1 April 2010.Cash is being raised by two Africa-focused oil and gas companies. Afren is to raise fresh funds through the issue of senior secured notes. Revenue in the first nine months of 2010 rose to $265.7m from $252.2m the year before. A loss of $7.6m last year turned into a $75.3m profit this time.BowLeven, meanwhile, is is to raise about £70m through a placing of up to 22m new shares, some 11% of the amount currently outstanding, to fund further drilling on its prospects in Cameroon.