London open: Poor start for Footsie

27th Oct 2010 08:44

London has followed on from last night's lacklustre performance on Wall Street and a weak display in Asia this morning with a poor start.Reports suggesting that any new stimulus in the US will be smaller than expected have knocked the miners with Kazakhmys, Xstrata and Rio Tinto the worst performers this morning.In company news, British American Tobacco's cigarette volumes rose in the Asia-Pacific region during the first nine months of 2010, but fell everywhere else as smokers cut back during the recession. The maker of Dunhill, Kent, Lucky Strike and Pall Mall grew market share, but volumes fell 1% to 526bn. They were up 5% in Asia-Pacific, but down 8% in Western Europe, 3% in Africa and the Middle East, and 2% in Eastern Europe.Organic volumes dropped 3% as more people stopped smoking, the illegal trade grew in some markets, and through the loss of sales in Pakistan after the floods. Industry volumes were "markedly lower" in Romania, Turkey, Pakistan, Germany and South Africa.Ad agency WPP enjoyed its fastest growth in a decade in the last three months chief executive Sir Martin Sorrell said yesterday, as recovery in corporate earnings fed through into marketing spending. Oil explorer Soco has had no more luck with its second well in the DR Congo than it had with its first. The firm will now plug and abandon the second well, Kinganga Nyanya 1, in the Nganzi Block. The well was drilled to 1,164 metres. There were oil shows in the Lower Bucomazi and the Chela formations and log analysis indicated oil pay in the secondary target Chela formation sands, Soco said. Floor coverings retailer Carpetright said group sales declined 5.2% in the 12 weeks ended 23 October 2010 and warned it expects tough market conditions to continue into 2011. The closure of its operations in Poland accounted for 0.5% of the total revenue decline. UK and Republic of Ireland sales declined 4.6%, with like-for-like sales down 7.3%. Chairman and chief executive Lord Harris said, "The tough trading environment in the UK and Republic of Ireland continued into the second quarter of our financial year. The further reduction in mortgage approvals along with fragile consumer confidence has produced a difficult market. We expect these market conditions to continue into 2011." Another heavy faller is CSR, the Bluetooth chip specialist, despite a "robust" third quarter, but revenue in the fourth quarter is expected to lower than last year. The company made sales of $222.1m during the three months, towards the bottom end of the $220-235m range predicted at the interim stage, though still up 6% on last year.DS Smith is in confident mood in the run up to December's interim results, which the paper and plastic packaging firm thinks will be way ahead of last year as the "encouraging" overall trading in the first quarter continued into the second. Helphire, which supplies replacement vehicles to drivers involved in accidents, is already predicting results for the year to June 2011 will be below current market expectations. The company, which only published its 2010 results at the start of this month, blames high petrol prices and fewer road miles being driven have led to lower accident rates.