News

With a little bit of help from a buoyant US market, London's blue-chips reversed earlier losses to finish predominantly higher.

Part-nationalised bank Royal Bank of Scotland was the day's best performer after US broker Merrill Lynch resumed coverage with a "buy" recommendation and a price target of 93p.

Investment analysts were poring over the third quarter sales figures issued by supermarket Tesco, which were slightly better than expected. Opinions are mixed, with Shore Capital rating the shares a "buy", Charles Stanley saying "accumulate" while Pali International remains neutral on the shares but has cut is price target to 300p from 345p.

Charles Stanley believes that fears over the threat to Tesco's business from the deep discounters is overdone, given that the cut-price supermarkets now have a lower market share than they did five years ago when Kwik-Save was in its downmarket pomp.

British Airways took off on confirmation that the long anticipated merger with Australian airline Qantas could be consummated. A potential merger with Qantas would be via a dual-listed company structure, the group added.

A confident Thomas Cook boosted full year profit despite high oil prices and tough economic conditions and the travel operator says current trading is in line with expectations. Adjusted profit before tax rose 32% to £309.3m on revenue up 11.8% to £8.81bn.

Mining stocks were doing a passable imitation of the Grand Old Duke of York, except they did not finish "neither up nor down"; most finished lower, though Vedanta was a notable exception after announcing a $250m share buy-back programme.

Housebuilders were in demand ahead of this week's interest rate decision, with another sharp reduction predicted. Plumbers' merchant Wolseley also moves up on expectations that a rate cut will revive the slumping UK housing market.

Greene King's interim profits fell by 15% with the pub company and brewer warning conditions have got worse in the second half and will deteriorate further. The dividend has been maintained but the shares slide as some shareholders had been expecting the company to maintain its tradition of hoisting the divi by 10%. Fellow pub group Punch Taverns stumbled in sympathy.

Sports fashion retailer JD Sports has blamed strong comparatives and the weak economy for a drop in like for like sales, although it still thinks full year profits will match forecasts.

Computer and video game retailer Game reiterated its previous guidance for the current year despite sales slowing recently. For the 18 weeks to end November total group sales were up by 9.3%. Like for like group sales for the same period were up by 1.5%. Sector peer HMV out-performed on positive comment from US bank Goldman Sachs, which also had positive things to say about consumer electronics retailer Kesa.

Annual pre-tax profit more than halved at toy maker Character Group as it struggled against a weaker than expected retail environment and exceptional costs related to a product recall. Pre-tax profit fell to £5.14m for the year ended 31 August 2008 compared to £12.56 the year before. No dividend has been recommended.

Russia and CIS focused exhibitions group ITE upped its dividend by 18% after reporting a 2% rise in full year pre-tax profit, but said it expects little or no growth in like-for-like volume sales this year.

Sharply lower metal prices have forced trader Wogen to take significant write-downs in its inventories for September year-end and as a consequence results will be materially lower than the previous year.

Hamish Grant, chief executive of lithium-ion battery maker Axeon, has stepped down following a warning that profits this year will be "considerably" below expectations.

The housing market slump has forced property developer Telford Homes to axe the dividend and warn that uncertainty about whether pre-sold homes will complete may hit full year figures.

Gem Diamonds and the Government of the southern African Kingdom of Lesotho have sold a 478 carat white diamond for $18.4m to the manufacturing arm of Graff Diamonds.
FTSE 100 - Risers
Royal Bank of Scotland Group (RBS) 64.00p +16.79%
Tesco (TSCO) 325.40p +12.99%
British Airways (BAY) 157.10p +12.46%
Admiral Group (ADM) 1,032.00p +9.38%
Petrofac Ltd (PFC) 323.25p +7.93%
Thomas Cook Group (TCG) 174.20p +7.40%
British Land Co (BLND) 519.50p +6.89%
Stagecoach Group (SGC) 171.50p +6.72%
Compass Group (CPG) 303.75p +6.21%
Wolseley (WOS) 303.50p +6.03%

FTSE 100 - Fallers
Rio Tinto (RIO) 1,270.00p -10.88%
Xstrata (XTA) 726.50p -10.75%
Fresnillo (FRES) 130.20p -7.13%
Old Mutual (OML) 51.00p -6.42%
Invensys (ISYS) 144.40p -5.00%
Sage Group (SGE) 157.80p -4.83%
Eurasian Natural Resources (ENRC) 227.50p -4.81%
BHP Billiton (BLT) 1,036.00p -4.25%
Barclays (BARC) 152.50p -3.48%
BG Group (BG.) 828.00p -2.76%

FTSE 250 - Risers
HMV Group (HMV) 122.00p +14.82%
F&C Asset Management (FCAM) 62.75p +12.05%
Wellstream Holdings (WSM) 383.75p +11.23%
Taylor Wimpey (TW.) 10.25p +10.81%
Kesa Electricals (KESA) 80.25p +8.81%
Trinity Mirror (TNI) 44.75p +7.19%
IG Group Holdings (IGG) 224.50p +6.78%
Grainger (GRI) 85.00p +6.25%
JPMorgan Russian Secs. (JRS) 204.00p +6.25%
Gem Diamonds (GEMD) 265.00p +6.00%

FTSE 250 - Fallers
Daejan Holdings (DJAN) 2,161.00p -15.88%
Hochschild Mining (HOC) 71.75p -11.15%
Hardy Oil & Gas (HDY) 196.25p -10.49%
Dairy Crest Group (DCG) 167.50p -10.43%
Investec (INVP) 248.00p -9.41%
Ashtead Group (AHT) 33.25p -8.90%
Shanks Group (SKS) 93.25p -8.13%
Punch Taverns (PUB) 97.75p -8.00%
888 Holdings (888) 68.75p -7.72%
Misys (MSY) 86.75p -7.22%