Several sectors experienced a reversal of fortune this week, with the miners suffering and something of a recovery amongst the house builders.
Several sectors experienced a reversal of fortune this week, with the miners suffering and something of a recovery amongst the house builders.
Overall, the FTSE 100 ended up slightly on the week, standing at 5283.30 on Friday morning.
Biggest Movers in the FTSE 350 (as at Friday 09.00)
| | RISERS | |
|---|
1 | Alliance & Leicester (LSE: AL.) | +49.14% |
2 | Bluebay Asset Management (LSE: BBAY) | +39.17% |
3 | Imperial Energy (LSE: IEC) | +37.95% |
4 | Johnston Press (LSE:JPR) | +23.88% |
5 | JD Wetherspoon (LSE: JDW) | +23.69% |
The biggest story of the week was in the banking sector, where mortgage lender Alliance & Leicester (LSE: AL.) agreed to be taken over by Spain’s Banco Santander (the giant which already owns Abbey National).
A & L shares soared a massive 49% on the back of the announcement.
The beleaguered house building sector also had an unexpectedly good week. Several big firms recovered somewhat after UBS removed ‘sell’ recommendations after deciding that share prices had fallen enough.
As a result of the broker’s move, Bellway (LSE: BWY) climbed 23%, Persimmon (LSE: PSN) rocketed 21% and Redrow (LSE: RDW) rose 19%.
Wobbles in the price of oil made themselves felt in a number of different industries: Oil stocks themselves were sold off as the price of crude fell amidst continuing US economic concerns.
Many of the big players were hit hard, with Tullow Oil (LSE: TLW) gushing down 10%, BG Group (LSE: BG.) sliding 5%, BP (LSE: BP.) draining away 4%, and Royal Dutch Shell B’ (LSE: RDSB) losing 7%.
And blue chip Drax Group (LSE: DRX), the operator of Europe’s largest coal-fired power station, fell 5% as power prices sank.
However, several transport operators benefitted from the lower oil price: British Airways (LSE: BAY) and cruise ship company Carnival (LSE: CCL) both travelled up 15%.
Overall, ITV (LSE: ITV) was the best blue-chip performer, jumping a whopping 18% as bid speculation continued to build. It emerged the broadcaster had been approached by predators believed to include both Endemol and RTL.
It seems that Brits are more likely to downsize their foreign holiday plans than scrap them entirely. Tour operators Thomas Cook Group (LSE: TCG) and TUI Travel (LSE: TT.) both rose 14% following a positive assessment of the sector by Morgan Stanley.
And in the FTSE 350, easyJet (LSE: EZJ) rose 20% after the broker argued that no-frills airlines may be credit crunch winners, capturing passengers trading down from more expensive seats and networks.
The pub sector was buoyed by a similar vein of speculation, and a surprisingly positive trading update from JD Wetherspoon (LSE: JDW).
Shares in the company fizzed up 24% after it said that more consumers, tightening their belts, were taking advantage of its discount meals and beer.
And on the back of this news, Mitchells & Butlers (LSE: MAB) glugged up 22% and Whitbread (LSE: WTB) rose 14%.
Another big winner in the FTSE 350 was Bluebay Asset Management (LSE: BBAY). The hedge fund manager leapt 39% after revealing that it continued to attract new client money in the last quarter, despite difficult economic conditions.
However, the mining sector experienced disappointment this week, with shares falling all over the place as metal prices declined.
Antofagasta (LSE: ANTO) and Vedanta Resources (LSE: VED) both fell 6%, and Ferrexpo (LSE: FXPO) drilled down 11%.
Xstrata (LSE: XTA) crumbled 10%, Lonmin (LSE: LMI) fell 9% and Eurasian Natural Resources (LSE: ENRC) subsided 6%. One of the biggest losers was Aquarius Platinum (LSE: AQP) - stocks in the precious metals miner dulled by 13%.
Elsewhere, car insurer Admiral (LSE: ADM) zoomed up 11% after UBS advised clients to buy ahead of the group’s half-year results, on the expectation of rising premiums.
Siberian oil explorer Imperial Energy (LSE: IEC) powered up 38% after confirming that it was in talks about a possible £12.90-a-share bid from an unnamed suitor.
And B&Q owner Kingfisher (LSE: KGF) built 14% after it nabbed both Kevin O’Byrne, the finance director of DSG International, and Peter Hogsted, the boss of Ikea’s UK operation.
However, Carphone Warehouse (LSE: CPW) slumped 4% on news that rival BT was planning to invest £1.5bn in a super-fast broadband roll-out.
And Yell Group (LSE: YELL), publishers of The Yellow Pages, fell 17% after UBS cut its target price and said that it may struggle with future debt repayments.
Notable announcements next week:
Monday: Domino’s Pizza, IG Holdings, Peter Hambro Mining
Tuesday: Enterprise Inns, Great Portland Estates, SCI Entertainment, Severn Trent, Vodafone
Wednesday: BHP Billiton, Daily Mail and General Trust, Euromoney Institutional Investor, Galiform, Glaxosmithkline, Halfords, Vantis
Thursday:Capita, Imperial Tobacco, Kingfisher, Rolls-Royce, Yell
Friday: Britvic, Mitchells & Butlers
