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Thursday's markets and press summary

Created:

22 June 2006

Markets latest:

Leading shares opened higher on Thursday, buoyed by strong global equity markets and firmer commodity prices, Reuters reported.

The FTSE 100 index was 50.3 points, or 0.9 percent, higher at 5,715.3 points in early trade, having closed 6.8 points higher on Wednesday.

Rising commodity prices boosted stocks such as Rio Tinto and Royal Dutch Shell. BP advanced 1.2 percent, Cairn Energy gained 2.6 percent, Shell rose 1 percent and BG Group was 1.4 percent higher as U.S. light crude oil prices firmed above $70 a barrel.

But British Airways slipped 3.7 percent after it said the Office of Fair Trading and the U.S. Department of Justice are probing alleged cartel activity -- relating to pricing -- involving the airline and others.

The airline also said its commercial director Martin George and head of communications Iain Burns had been given leave of absence during the investigation.

Among mid-caps, mortgage bank Bradford & Bingley said it is on track to grow 2006 profits by 6 percent after "very healthy" new business volumes this year and strong housing outlook.

But its shares fell 3.3 percent as dealers said investors might be honing in on signs of possible margin pressures.

For the latest on the FTSE100, click here For the latest on the FTSE All share, click here For the main winners and losers, click here

Press round-up

The London Stock Exchange is offering a higher yield and stricter covenants than similarly-rated companies in its debut bond issue, highlighting concerns among fixed income investors about a possible takeover of the UK exchange operator, says the FT.

Mecom, the Aim-listed investment vehicle of David Montgomery, the former Mirror Group chief executive, said in a statement that it is in discussions about a significant acquisition, understood to be the £700m sale of Orkla Media of Norway, says the Times.

Ryanair launched itself into the motor and home insurance markets yesterday, continuing on its quest to find ever more products to sell on to the 42 million passengers who travel on its planes each year, reports the Independent.

Gordon Brown’s declaration that he backs renewal of Britain’s nuclear deterrent will be welcome news for BAE Systems, Britain’s biggest arms manufacturer and builder of the current fleet of four Trident submarines, reports the FT.

The prospect of heavy fines and other regulatory action could cast a shadow over Thames Water’s planned flotation on the stock market later this year, says the Independent.

Investors in Langbar International, the suspended Aim-listed company under investigation by the Serious Fraud Office, have refused to back a rescue and compensation plan put to them this week, according to the Telegraph.

The fizz has long gone out of Britvic. Now a shortage of passion fruit is triggering fears of another sales collapse for the embattled drinks group, writes the Times.

Crownstone European Properties, chaired by Ron Spinney, the former chief executive of Hammerson, has suspended plans for a €425 million (£292 million) flotation on Euronext because of volatile market conditions, writes the Times.

UBS was named the best investment bank for equity research for the sixth consecutive year yesterday in a respected City survey, reports the Independent.

Apax, the private equity house, is considering an approach worth at least £1 billion for Endemol, producer of Big Brother, The Times has learnt.

ITV has announced plans to slash its sports programme budget as part of a £100m cost-cutting exercise and to hand back an extra £200m in cash to shareholders, following a decline in advertising revenues in the first half of the year, writes the Independent.

Detractors say that Goldman Sachs, the financial giant famous for its powerful investment bank, has turned into "the world's biggest hedge fund". Yesterday, it appeared that they might be absolutely right, says the Independent.

Press summary sourced from Sharecast/DigitalLook

Technical comment:

InvestorsIntelligence comments: "We are now seeing gradual improvement moving through in our bullish% indicators, with the FTSE100 gaining another 1% to 33.7%. Bull markets need to be supported by rising or firm breadth statistics, and we now have the former. We would like to see this indicator recapture the 40% floor, the bottom of the breadth range for the 2003 to 2006 bull run. However, in the shorter-term, this appears to have turned into a barrier."

For the latest InvestorsIntelligence comments on index breadth, click here

To go back to the company news round-up, click here