COMMENT
This Week's Market Movers

By David Kuo (TMFDragon)
December 10, 2004

Biggest Movers In The FTSE 350 (as at Fri 10am)

In a week that saw the Bank of England stand pat on interest rates, and gold take a tumble, London shares fell. By mid-morning on Friday, the FTSE was 0.9% lower on the week.

Banks have been in focus again, following trading updates from a trio of Britain's biggest money lenders. Standard Chartered (LSE: STAN) was first out of the blocks on Wednesday, but its shares retreated 3% to 959p after it said revenues in its biggest market, Hong Kong, will be flat.

However, Royal Bank of Scotland (LSE: RBS) climbed 1% to 1,694p after it said it was "very confident" of meeting expectations for full-year profits. HSBC (LSE: HSBA) also said that it has been trading satisfactorily, but its shares slipped 2% to 876p on news that corporate borrowing was slowing.

Orange has launched its 3G service in the UK. The French-owned telecom firm said its shops were now stocked with four new 3G handsets. No to be outdone, mmO2 (LSE: OOM), static at 119p, announced that its 3G service will go live next summer.

Stagecoach Group (LSE: SGC) charged ahead 15% to 111p after posting strong first-half results. The bus operator added that its restructured American business has improved. Stagecoach's impressive performance rubbed off on National Express (LSE: NEX), which jumped 7% to 806p.

Sticking with transport, EasyJet (LSE: EZJ) reported a 25% jump in passenger numbers to 2.1m after it introduced new routes in Europe. However, its shares fell 3% to 179p when it owned up to a slight dip in its load factor.

BAE Systems (LSE: BA.) was on a downward path too, after flagging up concerns about margins. BAE, down 7% to 239p, said it has made good progress on a deal with the UK Government over the Eurofighter Typhoon programme. However, it disappointed with its outlook for next year.

Margin worries were also behind the fall at Cobham (LSE: COB), which tumbled 14% to 1,248p. The aerospace company said profits this year will be broadly in line with expectations, though margins would lower that anticipated.

Elsewhere amongst the engineers, Jarvis (LSE: JRVS) crumbled 12% to 9.5p on concerns over financing, and Premier Farnell (LSE: PFL) slid 18% to 159p after it warned that its sales growth was slowing. Smiths Group (LSE: SMIN) gained 1% to 774p after it agreed to buy American medical firm Medex.

Premier Foods (LSE: PFD) has gobbled up Bird's Custard and Angle Delight from Kraft Foods (NYSE: KFT) for £70m. Its shares rose 1% to 259p. Elsewhere, HHG (LSE: HHG) hardened 6% to 54p, on news that it plans to sell its Life Service business for £1.0b and return £875m to shareholders.

There was mixed news for Tate & Lyle (LSE: TATE), which will be soon promoted to the FTSE 100 after a seven-year absence. However, its shares soured 4% to 460p after a major shareholder sold its entire 10% stake in the company. Centrica (LSE: CNA) was under pressure too. The owner of British Gas saw its shares drop 8% to 235p after it said high energy prices was hurting margins.

The Market Next Week

Three more banks, namely Lloyds TSB (LSE: LLOY), HBOS (LSE: HBOS) and Alliance & Leicester (LSE: AL.), will be providing trading updates. There are also figures from Cadbury Schweppes (LSE: CBRY) and retirement-home builder Mccarthy & Stone (LSE: MCTY).

Notable announcements next week

Monday: GKN, Lloyds TSB and Photo-Me
Tuesday: Carpetright, First Choice, HBOS, Hardys & Hansons and iSoft
Wednesday: Alliance & Leicester, Cadbury Schweppes, Hanson and P&O
Thursday: Ashtead, RMC and Victory Corp.
Friday: McCarthy & Stone