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  Randgold, Fresnillo and Lonmin weak as Gold, silver and platinum fall, FTSE 100 slides
Reported by Proactive Investors on Thursday, 15 October 2009 (on October 15, 2009)
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Overview: the Q3 results that came out before the market opened in the US were mixed. Goldman Sachs (NYSE: GS) and Citigroup (NYSE: C) managed to beat forecasts, with Goldman posting better than expected earnings, while Citigroup’s losses turned out to be softer than was projected. However, later on Finnish communications corporation Nokia (NYSE: NOK) posted a US$836 million quarterly loss, while sales dipped 20%, falling well short of market expectations.
Wall Street got off to a slow start as the Dow Jones industrial average declined 0.3% in early trade.
The FTSE 100 also turned negative, taking a big hit from the mining and oil and gas sector, which were weak on lower oil and metals prices. Anglo-Swiss miner Xstrata (LSE: XTA) also contributed by walking away from its bid for Anglo American (LSE: AAL), which sent the latter down 4% and further weighed on the sector and the FTSE 100.
Supermarket chain Sainsbury (LSE: SBRY) helped trim the Footsie’s losses to a minimum with a 10% rally on the news that the Qatar Investment Authority was pondering on making another bid after deciding against a takeover in late 2007 due to the erupted financial crisis.
Commodities
Oil prices recovered with November Brent Crude rising to US$73.42/barrel, while US light, sweet crude improved to US$75.47/barrel, helping the oil and gas sector trim its early losses.
BG Group (LSE: BG) declined marginally, as did BP (LSE: BP), while fellow supermajor Shell (LSE: RDSB) lost 1.3%.
Cairn Energy (LSE: CNE) and Tullow Oil (LSE: TLW) both declined about 1.5%, while Petrofac (LSE: PFC) was at the bottom of the pile with a loss of 2.3%.
Dana Petroleum (LSE: DNX) and Heritage Oil (LSE: HOIL) were the leading fallers among the midcaps, shedding 2.5%, while fellow FTSE 250 constituent Dragon Oil (LSE: DGO) fell 1%.
Atlantic Canada operating oil and gas group Enegi Oil (AIM: ENEG) emerged as the top riser among the juniors with a 6.7% climb. Mongolia-focused Petro Matad Ltd (AIM: MATD) rose 6%.
North American focused oil & gas junior Pantheon Resources (AIM: PANR) also did well, rising 4.5%.
South American Focused explorer Pan Andean Resources (AIM: PRE) went in a different direction, shedding 6%. Iraq operating Irish oil company Petrel Resources (AIM: PET) and Ukraine focused gas producer, Regal Petroleum (AIM: RPT) both lost 4%.
Peru, Colombia and Cuba operating oil and gas explorer and producer Gold Oil (LSE: GOO) pulled back 2.5%.
Miners trim losses as Gold and Silver recover
Precious metals partially recovered form early losses. Gold inched higher, almost returning to US$1,060/oz, while Silver improved to US$17.64/oz. Platinum held steady at US$1,349/oz.
Silver miner Fresnillo (LSE: FRES) and specialty chemicals firm Johnson Matthey (LSE: JMAT) were the top performers in the sector with marginal losses. Gold producer Randgold Resources (LSE: RRS) declined 3%, while platinum miner Lonmin (LSE: LMI) lost 2.5%.
Yamana Gold (LSE: YAU) dipped 4.6%.
In the FTSE 250, gold miner Petropavlovsk (LSE: POG) and silver producer Hochschild Mining (LSE: HOC) lost 3.8% and 2% respectively, while Aquarius Platinum was at the bottom of the pile with a 5.5% decline.
Junior commodity asset development company Mercator Gold (AIM: MCR) was the leading riser in the sector today with a 12% rally. Turkey focused gold miner Ariana Resources (AIM: AAU) and Tajikistan operating gold miner Kryso Resources (AIM: KYS) followed with gains of over 6%.
Australian gold and copper prospector Solomon Gold (AIM: SOLG) advanced 4.2%.
Uzbekistan focused gold miner Oxus Gold (AIM: OXS) went in a different direction, sliding almost 6%. Philippines focused gold producer Medusa Mining (AIM&ASX: MML) declined 5%.
African focused gold miner Pan African Resources (AIM: PAF) lost about 3%.
Copper and Nickel bounce back
Base metals also managed to recoup some of their early losses. Copper moved up to US$2.79/pound, while Nickel inched higher to US$8.32/pound. Zinc climbed to US$0.90/pound.
Base metals focused mining stocks also turned red today. Anglo American (LSE: AAL) was the leading faller after Xstrata (LSE: XTA) decided against making another bid for the company after getting turned down in June. Anglo slipped 4%, while Xstrata (LSE: XTA) was down 1.5%.
The world’s largest miner BHP Billiton (LSE: BLT), Eurasian Natural Resources (LSE: ENRC), Rio Tinto (LSE: RIO) and Vedanta Resources (LSE: VED) also lost around 1.5%.
Chilean miner Antofagasta (LSE: ANTO) and Kazakhmys (LSE: KAZ) declined marginally.
London's only listed pure iron ore producer and FTSE 250 constituent, Ferrexpo (LSE: FXPO) outperformed the sector with a 2.5% climb.
Tunisia focused metal miner Maghreb Minerals (AIM: MMS) and tantalum concentrate supplier with assets in Mozambique Noventa (AIM: NVTA) led the juniors, rallying 12% and 10% respectively. Indonesia operating coal miner Churchill Mining (AIM: CHL) also was in buying mode, adding 3.6%.
Laterite nickel specialist European Nickel (AIM: ENK) moved with the market, declining 5%. Russia operating copper and nickel miner Amur Minerals (AIM: AMC) and Uranium and copper explorer Kalahari Minerals (AIM: KAH) both shed 3%.
Banks, insurance, private equity
Bailed out banks Lloyds (LSE: LLOY) and Royal Bank of Scotland (LSE: RBS) declined marginally, while HSBC (LSE: HSBA), Barclays (LSE: BARC) and Standard Chartered (LSE: STAN) all lost about 1%.
Insurers did slightly better. RSA Insurance (LSE: RSA) was in the lead with a 2.1% gain, while Aviva (LSE: AV) and Prudential (LSE: PRU) gained 1.8%. Friends Provident (LSE: FP) and Standard Life (LSE: SL) added 1%.
Standard Chartered (LSE: STAN) went against the tide, shedding slightly more than 1%. Old Mutual (LSE: OML) declined marginally.
Private equity group 3i (LSE: III) was in buying mode, climbing 3.9%.
Large and Mid Cap News
Xstrata Plc (LSE: XTA) announced that it has no intention of making an offer for Anglo American (LSE: AAL). This morning’s statement follows Xstrata’s latest protracted merger attempt. In 2008 Xstrata failed in a bid to acquire Lonmin, another FTSE 100 constituent and top tier platinum miner. The Anglo-American approach was made in June. Following the disclosure of Xstrata's approach, Anglo American released a statement on the 22nd June in which it rejected Xstrata's proposal.
Performance management specialist Avisen PLC (AIM: AVI) said it was named the exclusive distributor of Acorn Systems' profitability and cost management software in the United Kingdom and South Africa.
Rathbone Brothers Plc (LSE: RAT) confirmed that it is in discussions with Lloyds Banking Group (LSE: LLOY) regarding the potential acquisition of a portion of its non core private client discretionary investment management activities.
German industrial giant Siemens (NYSE: SI) has agreed to acquire investment firm Ecofin Ltd's 63 percent stake in Israeli thermal power company Solel Solar Systems for US$418 million to expand its footing in the renewable energies market.
Mothercare plc (LSE: MTC) updated investors on its trading for the first half of the current financial year. The childcare and early years retailer increased total group sales by 8.2% as their primary Mothercare and Early Learning Centre brands perform well across all channels.
PartyGaming Plc (LSE: PRTY) released their interim management statement for Q3 performance, which showed an 11% increase in total revenue which was largely driven by the newly acquired Cashcade, which recorded $13.8m in the quarter. PartyGaming state that it is confident about the Group's full year prospects.
Shares in engineering firm Aggreko plc (LSE: AGK) rose 10% this morning following the release of an interim management statement, which reflects a ‘bottoming out’ of the economic decline. While revenues have fallen compared to 2008, the group has reduced debt by £61m since June and achieved a considerable improvement to group margins. The company now expects full year profits to exceed 2008 levels.
Small Cap News
Central China Goldfields (AIM: GGG) said today it was in the market for gold and copper assets in Southeast Asia, looking to spend the cash it derived from the recent sale of its Nimu copper exploration project in China.
Accsys Technologies PLC (AIM, Euronext: AXS) said it has reached agreement with a number of distribution partners in North America, and its unit Titan Wood Ltd has been approved by the North American Window and Door Manufacturers' Association (WDMA) as a Hallmark Certified Supplier.
UK and Europe focused online publishing business Play LA (OTCBB: PLLAF) has hired UK based digital agency Branded3 to manage the search engine optimisation and marketing for its three UK websites, looking to improve its search rankings and increase traffic.
North America and Australia focused mining and exploration holding Sirius Exploration (AIM: SXX) has acquired Australian based private company Adavale Limited in a share only deal worth £19.5 million to obtain two more permits in the Adavale Basin, now covering the majority of the Boree salt deposit.
Investor got a sense of ‘deja vu’ this morning as Gene therapy company Oxford BioMedica (LSE: OXB) announced new data from it’s the ongoing Phase I/II trial of its gene therapy treatment of Parkinson's disease, Prosavin.
San Leon Energy (AIM: SLE) has put forward a share only non-binding offer for Irish exploration and production company Island Oil & Gas (AIM: IOG) of one new share for 2.3 shares in Island valuing the company at £13.6 million, which represents a 31% premium to IOG’s yesterday’s closing price.
Investment firm Altus Resource Capital (LSE: ARCL) said its net asset value was 110.1 pence as of 30 September, marking an increase of 15.9% since its launch in June this year, owing to its exposure to the junior resource market, which has benefited from higher commodity prices and increased M&A activity.
LonZim PLC (AIM: LZM), an investment company focused on Zimbabwe, said significant milestones have been passed to stimulate economic recovery in the country, and it is currently reviewing a number of potential further investments.
Pacific North West Capital (TSX: PFN) and Alto Ventures (TSX-V: ATV) commenced drilling on its Destiny gold project in Quebec, aimed at expanding the known resources at the DAC zone through infill and step out drilling.
Links: Full news story
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