News

Wall Street's weak opening made up London's mind for it after a day of dithering in which the Footsie bobbed above and below last night's close. The benchmark index ended in arrears, though there were plenty of bright features to be found.

Prudential said its capital position remains robust as it reported a 15% rise in sales in the nine month ended 30 September to £2,302m, but added that it is unlikely to achieve its goal of doubling 2005 Asian new business profit a year early in 2008. Sector peers Legal & General and RSA gained support from Prudential's broadly reassuring statement.

Life assurance company Standard Life was marked down, however, on reports that it is considering increasing its already substantial investments in bail-out banks HBOS and Royal Bank of Scotland (RBS). Elsewhere in the banking sector Standard Chartered and HSBC were put on the back foot by Prudential's caution on the growth rates of Asian markets.

Tullow Oil was higher on a combination of aggressive talk from OPEC and a new discovery in Uganda. Tullow Oil and partner Heritage Oil described the find as an 'exciting' start to their campaign at the project.

Broker KBC Peel Hunt says: "The current drilling campaign in Uganda has the potential to take the total discovered resources up to the threshold at which a long distance pipeline to the East African coast becomes viable - around 400 million barrels of oil."

The broker values Tullow's core net asset value per share at 414p, with a price target of 727p.

Diversified miner Xstrata lifted production across its commodity portfolio in the third quarter, but suffered the effects of lower prices for some of the raw materials it produces. Broker Evolution, which has a price target of 1050p for Xstrata, was encouraged enough to upgrade its stance on the shares from "sell" to "reduce", while Numis Securities rates the stock a buy, as does UBS.

Meanwhile, there are rumours circulating in the market that the recent halving of Xstrata's share price may tempt erstwhile suitor Vale Group to revive its interest in taking over Xstrata.

Plumbing supplies merchant Wolseley got a lift from Numis Securities, which said the shares have reached a value where they are worth looking at.

Department store Debenhams kicked off a busy week for results from retailers with better than feared figures. Profits in the year to August fell to £105.9m from £113.2m on sales of £1.84bn up from £1.77bn. Like-for-like sales fell by 0.9%. US broker Merrill Lynch, which has an under-perform rating on the shares, said it would not be changing its 08/09 estimates as a result of today's announcements, which it said was a positive development, "given the recent raft of negative news flow in the sector."
The Office of Fair Trading (OFT) has accused eight recruitment agencies, including industry giant Hays, of price fixing and unfair boycotting practices in dealings with UK construction companies.

Filters group Filtrona slumped on a warning the ongoing strike at Boeing and weak trading elsewhere will mean profits this year coming in at the lower end of its forecasts."Current business trends, combined with the ongoing impact of the Boeing strike, indicate that Filtrona's performance in 2008 is likely to be at the lower end of the board's previous expectations," it said.

Electronics and technology firm Laird moved higher despite saying organic revenue growth is unlikely to meet the medium term growth expectations while current conditions persist.

Salamander Energy has withdrawn its £124m offer for Serica in light of the continued uncertainty in the capital markets and volatility in the price of oil. Serica Energy last month rejected an all-share bid approach from Salamander Energy worth around 70p a share.

Oil and gas groups EnCore Oil, Faroe Petroleum and Stratic Energy said testing was completed on the East Breagh well 42/13-4, producing 10.2m standard cubic feet of gas per day. According to stockbroker Teathers, de-risking Breagh would add more than 50p to Faroe's core net asset value of 70p per share. Teathers has a price target of 190p on Faroe.

Brit Insurance reported a 10.5% rise in nine-month gross written premium and said it sees a more positive rating outlook for 2009 than some months ago.

Hargreaves Lansdown saw a fall in assets under administration (AUA) in the first quarter as the turmoil plaguing the markets began to affect the investment manager. AUA on September 30 totalled £9.4bn, down from £10.2bn on June 30.

FTSE 100 - Risers
3i Group (III) 517.00p +14.76%
Legal & General Group (LGEN) 73.20p +10.91%
RSA Insurance Group (RSA) 124.50p +7.05%
Rexam (REX) 343.75p +6.34%
Prudential (PRU) 348.50p +5.53%
BG Group (BG.) 814.00p +5.37%
Eurasian Natural Resources (ENRC) 423.75p +5.34%
Rolls-Royce Group (RR.) 282.50p +4.63%
British Airways (BAY) 141.90p +4.57%
HBOS (HBOS) 82.50p +4.56%

FTSE 100 - Fallers
British American Tobacco (BATS) 1,568.00p -8.52%
Standard Chartered (STAN) 1,037.00p -8.23%
Royal Bank of Scotland Group (RBS) 79.30p -6.15%
Scottish & Southern Energy (SSE) 1,164.00p -5.98%
WPP Group (WPP) 366.75p -5.35%
Vodafone Group (VOD) 111.80p -4.85%
Standard Life (SL.) 224.25p -4.57%
Autonomy Corporation (AU.) 969.00p -4.53%
Severn Trent (SVT) 1,327.00p -4.39%
HSBC Holdings (HSBA) 810.00p -3.57%