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  Oil weakens, but BP, BG, Cairn, Petrofac and Tullow gain to lift FTSE 100
Reported by Proactive Investors on Friday, 13 November 2009 (on November 13, 2009)
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Overview: the US stock market got off to a good start despite an unexpected decline in the Reuters/University of Michigan preliminary index of consumer sentiment, which slid to 66 in November from 70.6 in the previous month as was revealed in today's update.
The Dow Jones Industrial Average climbed 0.8% in early trade, while the broader S&P 500 index tacked on 0.65% and the technology heavy Nasdaq composite added 0.5%.
The FTSE 100 benefitted from the bullish start on Wall Street, ending the day with small gains after slipping into the red in late afternoon as losses in the mining sector outweighed a strong performance by the commercial and energy stocks.
Mining companies flooded the top fallers list with ENRC (LSE: ENRC) leading the way with a 3.7% loss. Vedanta (LSE: VED), Xstrata (LSE: XTA), Antofagasta (LSE: ANTO), Kazakhmys (LSE: KAZ) and Randgold Resources (LSE: RRS) followed, shedding more than 2.5%. Inter-dealer Money broker ICAP (LSE: IAP), software developer Autonomy Corporation (LSE: AU) and packaging group Rexam (LSE: REX) were the only non-mining stocks among the leading fallers with declines of nearly 3%.
Commercial property companies remained atop the leaderboard for the entire day, however, had their early gains trimmed in the afternoon. Liberty International (LSE: LII) and British Land (LSE: BLND) advanced 3%, while Land Securities (LSE: LAND) and Hammerson (LSE: HMSO) tacked on more than 2%.
InterContinental Hotels (LSE: IHT) also did well, climbing 2%, while National Grid (LSE: BG) added 1.5%, as did British Airways (LSE: BAY), which announced its merger with Spanish airline Iberia today.
Commodities
Oil prices kept on falling today with December Brent Crude sliding to US$75.53/barrel and US light, sweet crude retreating to US$76.10/barrel.
With the exception of Shell (LSE: RDSB), which posted a small gain, all blue chip oil and gas stock were on the rise on Friday. Cairn Energy (LSE: CNE) was in the lead with a 1.6% climb, while BG Group (LSE: BG) tacked on 1%. BP (LSE: BP), Petrofac (LSE: PFC) and Tullow Oil (LSE: TLW) rose marginally.
Midcaps were mixed as while Dragon Oil (LSE: DGO) posted a small gain and Dana Petroleum (LSE: DNX) added 2.4%, Heritage Oil (LSE: HOIL) slid 2%.
Junior companies didn’t show much movement today. Europe focused oil and gas developer Ascent Resources (AIM: AST) was on of the top performers with a 3% advance. Peru, Colombia and Cuba operating oil and gas explorer and producer Gold Oil (LSE: GOO) and Iraq operating Irish oil company Petrel Resources (AIM: PET) both added 2.5%.
Energy investor Xtract Energy PLC (AIM: XTR) moved in the opposite direction, shedding 5.5%. Mongolia-focused Petro Matad Ltd (AIM: MATD), Atlantic Canada operating oil and gas group Enegi Oil (AIM: ENEG), North American based explorer Nighthawk Energy (AIM: HAWK) and Western Europe operating oil and gas company Northern Petroleum (AIM: NOP) all lost more than 3%.
Gold, silver and platinum stay low to weaken miners
Precious metals slightly improved from the morning levels with gold rising to US$1,106/oz and platinum climbing to US$1,357/oz. However, silver declined further, sliding to US$17.11/oz.
Gold miner Randgold Resources (LSE: RRS) was at the bottom of the pile with a 2% decline. Plaitnum miner Lonmin (LSE: LMI) lost 1.5%, while silver producer Fresnillo (LSE: FRES) shed 1.2%.
Specialty chemicals firm Johnson Matthey (LSE: JMAT) outperformed the sector with a 1% climb.
Mid tier miners were mixed. Aquarius Platinum (LSE: AQP) did well, tacking on 2.3%, while gold miner Petropavlovsk (LSE: POG) and silver producer Hochschild Mining (LSE: HOC) lost 2% and 3% respectively.
South Africa and Botswana operating diamond miner Firestone Diamonds (AIM: FDI) was among the top performers in the sector, climbing 5% after releasing its final results.
Western Australia operating Norseman Gold (AIM: NGL) followed with a 4% gain, while UK-registered China operating copper and gold miner Central China Goldfields (AIM: GGG), Africa operating gold miner GMA Resources (AIM: GMA), Philippines focused Metals Exploration (AIM: MML) and Canada based junior gold developer Rambler Metals and Mining Plc (AIM: RMM) all gained more than 3%.
Copper and nickel slide
Base metals also weakened. Copper and nickel dropped to US$2.93/lb and US$7.24/lb respectively, while zinc declined to US$0.96/lb.
Anglo American (LSE: AAL) was the only base metals focused stock to stay above the opening level.
BHP Billiton (LSE: BLT) and Rio Tinto (LSE: RIO) declined marginally, while Kazakhmys (LSE: KAZ) slid 2.5%. Antofagasta (LSE: ANTO) and Xstrata (LSE: XTA) lost 3%, while Eurasian Natural Resources (LSE: ENRC) and Vedanta Resources (LSE: VED) shed almost 3.5%.
London's only listed pure iron ore producer and FTSE 250 constituent, Ferrexpo (LSE: FXPO) moved with the market, posting a marginal loss.
Russia focused copper and nickel miner Amur Minerals (AIM: AMC) led the sector with a 17.5% rally. Tantalum concentrate supplier with assets in Mozambique Noventa (AIM: NVTA) and Strategic Natural Resources (AIM: SNR) followed with gains of 7% and 5% respectively. Tunisia focused metal miner Maghreb Minerals (AIM: MMS) was up 4.5%.
Zinc miner Connemara Mining (AIM: CON) led the fallers, slipping 10%. Copper and nickel explorer Regency Mines (AIM: RGM) and Philippines operating nickel miner Rusina Mining (ASX: RML; AIM: RMLA) followed with losses of 4.5% and 4% respectively.
Banks, insurance, private equity
Banking stocks were in decline today with the exception of HSBC (LSE: HSBA), which rose 1.2%. Part-nationalised banks Lloyds (LSE: LLOY) and Royal Bank of Scotland (LSE: RBS) declined marginally, while Barclays (LSE: BARC) and Standard Chartered (LSE: STAN) both shed 1.6%.
Prudential (LSE: PRU) was the top performer in the insurance sector with a 1.7% climb. Old Mutual (LSE: OML) and car insurer Admiral Group (LSE: ADM) rose marginally.
Aviva (LSE: AV), Legal & General (LSE: LGEN), RSA Insurance Group (LSE: RSA) and Standard Life (LSE: SL) declined marginally.
Private equity group 3i (LSE: III) advanced 1.6%.
Large and Mid Cap News
The boards of British Airways (LSE: BAY) and Spain's Iberia (IBEX: IBLA) agreed a binding memorandum of understanding (MoU) setting out the terms for a merger. According to Iberia the merger would create ‘a real global airline’ and that the companies are ‘laying the foundations’ for one of the most important airlines in the world.
BG Group (LSE: BG) said a hydrocarbon find at a new well in the deep-water Santos Basin offshore Brazi, Tupi North-East, has reinforced the potential of its exploration projects in the basin. The Tupi North-East is located in the Tupi evaluation area in a water depth of 2,115 metres.
Balfour Beatty (LSE: BBY) announced is to acquire Texas based SpawMaxwell Co from its management for up to US$25 million in cash. SpawMaxwell is one of the largest contractors in Houston, Texas. The company also has offices in Austin and Dallas and has delivered more than 40 million square feet of interior construction projects.
Interim results from consumer packaging company Rexam (LSE: REX) didn’t bring much cheer this morning. The results were in-line with expectations, but only thanks to cost reduction initiatives and positive foreign exchange translations, which offset weaker volumes. The interim results covered to the period from July to date.
Impala Platinum (LSE: IPLA, JSE: IMP) reported higher production from its mines in Zimbabwe and increased deliveries to Impala Refining Services (IRS), whose refined platinum production jumped 59% compared to the previous quarter.
Ryanair Holdings PLC (LSE: RYA) has welcomed the proposed merger of British Airways (LSE: BAY) and Spain's Iberia (IBEX: IBLA) as it believes that the deal draw more clients towards the Irish no-frills airline.
Small Cap News
South Africa and Botswana operating diamond miner Firestone Diamonds (AIM: FDI) reported higher revenues for the full year, which saw a number of operational successes, and said it would now concentrate on developing a mining operation on the BK11 kimberlite and finalizing the contract with Debswana for the design, construction and operation of a tailings plant at the Jwaneng mine.
Shares in Red24 (AIM: REDT) were in demand this morning after the security company announced contract wins with two major insurance underwriters in the US to provide special risk consulting services.
Creat Resources Holdings Ltd (AIM: CRHL), the exploration and development company with assets in Western Tasmania, Australia, said it is in discussions with a party that may result in a reverse take-over.
South East Asia and West Africa operating gold miner Avocet Mining PLC (AIM: AVM) has agreed to sell its entire interest in Merit Mining Corporation (TSX-V: MEM) to Infinity Gold Mining for up to C$7 million in cash.
SatCom Group Holdings PLC (AIM: SGH) reported strong full-year results, with revenues and profits increasing in spite of the global downturn, though the economic climate remains challenging.
Australian-listed resource company Gippsland (ASX: GIP) holds out big hopes for the Abu Dabbab and Nuweibi tantalum-tin metal-feldspar projects, according to a report to the Australian Securities Exchange.
Electrical machines and power electronics company Turbo Power Systems (AIM, TSX: TPS) reported improvements in its financial performance in the third quarter as revenues rose and net loss narrowed, expecting the business to strengthen as production in its target markets increased.
South American focused gold producer, Minera IRL (AIM: MIRL) reported solid progress on a number of fronts in its third quarter (June-Sept) and first nine months of 2009 ("YTD").
China’s largest orange plantation owner Asian Citrus Holdings Limited (AIM: ACHL) said its application for listing on the Hong Kong Stock Exchange was considered by the listing committee, and shares were expected to be admitted to trading in two weeks.
There was a further shake-up among Fusion IP’s (AIM: FIP) major shareholders yesterday. Institutional investors, Invesco Limited and Legal and General Investment Management both increased their holdings, meanwhile Brookwell Limited exited its position in the University IP commercialisation company.
African-focused Shield Mining (ASX: SHX) has launched a new drilling programme at the Tijirit Gold Project in Mauritania, where significant gold intersections were encountered earlier this year. The project is adjacent to Red Back Mining's (AIM: RBI) Tasiast gold mine.
Shares in the Irish diamond miner African Diamonds (AIM: AFD) rise 8.9% as news emerges that De Beers is to sell its entire 71% stake in the joint AK6 Botswana diamond project. The company will now be able to move forward with construction on the site. Mining operations are expected to begin in early 2012.
Links: Full news story
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