News

The Footsie slipped back below 6000, mirroring Wall Street's downturn, to end the day mixed. Financial stocks were primarily responsible for dragging the index down from its early afternoon high, as they mirrored the weakness of US financials ahead of President Bush's speech on his proposed programme to stimulate the US economy.

Miners were in demand, however, with Xstrata and Rio Tinto both benefiting from bid speculation.

Xstrata posted the Footsie's biggest gains on speculation that Brazilian company Vale do Rio Doce will make a run at the UK-listed copper producer.

Talk of a new, higher offer from BHP Billiton for Rio Tinto boosted the latter. The rumour is of a bid worth 3.58 BHP shares plus A$16.50 cash for Rio.

Recent falls in the share price of Kazakhmys prompted HSBC to upgrade the Kazakhstan-focussed miner to 'overweight' from 'neutral'.

The LSE closed well ahead after Prime Minister Gordon Brown opened a new office for the group in China and urged the country to allow more firms to list in London.

Builders merchant Wolseley was up ahead of its next trading statement, due on Monday.

Carphone Warehouse reversed early losses despite missing targets for new connections in the third quarter, as it maintained its positive outlook for the year.

Figures from the Office for National Statistics showed retail sales dropped 0.4% last month, the worst since January 2007, but Next and M&S still managed good gains.

DIY companies Kingfisher and Home Retail also did well - the latter after an upgrade from Bear Stearns. The retail sales fall, which contradicted analysts who had predicted a 0.2% increase, raised hopes that interest rates will be cut next month.

Accountancy software group Sage was another stock advancing on the back of broker comment, as Merrill Lynch picked it as one of the best stocks in the UK technology sector.

Financial stocks were very weak, though, with insurers Standard Life, Old Mutual, Prudential and Aviva all friendless following a report that Aegon unit Scottish Equitable froze withdrawals from its property fund, as the credit crunch brought cash liquidity levels down to just 5%.

Elsewhere in the financial sector Barclays and ICAP were on the back foot.

Fund managers tumbled after a dismal statement from New Star. It warned operating profits will be significantly lower in 2008 than in 2007 and has cut its final dividend "to maintain its financial position". Assets under management fell to £23.1bn at 31 December 2007, down 6.5% from £24.7bn in June, blamed on its European mutual funds and some of its UK mutual funds. Schroders fell in sympathy.

Fixed income specialist BlueBay was down despite saying it has done fine in the past year. RAB Capital was little changed after a forecast of a flat performance in 2007 with net income approximately £135m (2006: £132.5m) and pre-tax profits £50m (2006: £50.6m).

Engineer and designer Aveva was wanted after it predicted full year results would be significantly ahead of expectations driven by high demand and rising energy prices

Elsewhere, nightclub operator Luminar is confident that pre-tax profit for the full year should be within the current market forecast range. It said the trading environment toughened from mid November and continued throughout the first half of December, but trading over Christmas and New Year was still "satisfactory".

Character licensor Entertainment Rights says sales in 2007 were below analysts' expectations "with a consequent impact on profitability". The company said group revenue was expected to be below the lower end of the current range of market forecasts.

Cineworld's trailer for its full year results was well received. The cinema chain owner said the new year has started strongly and with a promising schedule of film blockbusters lined up, 2008 looks like being a good year for the company.

Guy Hands, the chairman of EMI, the music company, remains in the spotlight with the Times reporting he has tabled a bid for Chrysalis, one of Britain's last big independent music groups.

SCi Entertainment's chief executive and two managing directors have left the computer game group with immediate effect following last week's news that the group expects to make a loss in 2008. The shares rose on hopes that this might lead to a revival of bid interest in the company.

Shopping trolley security firm Gatekeeper Systems lost more than half its value today as it warned of a sharp fall in both revenue and profits for 2007.

Gatekeeper's spectacular fall was outdone, however, by Citel, which lost more than two-thirds of its value after admitting its full yeaqr profits would be unlikely to meet market expectations, despite substantial growth in sales of its core Portico TVA product.

Medical devices firm ClearStream Technologies slumped Friday on news that a shortfall in the expected level of co-labelling sales will lead to first half total sales below last year's equivalent and less than expectations.
FTSE 100 - Risers
Xstrata (XTA) 3,363.00p +8.59%
Sage Group (SGE) 228.50p +6.03%
Rio Tinto (RIO) 4,700.00p +4.93%
Home Retail Group (HOME) 279.25p +4.88%
Kingfisher (KGF) 129.90p +4.34%
London Stock Exchange Group (LSE) 1,650.00p +3.97%
Marks & Spencer Group (MKS) 414.50p +3.82%
Experian Group (EXPN) 372.75p +3.54%
Liberty International (LII) 1,005.00p +3.40%
Taylor Wimpey (TW.) 181.10p +3.31%

FTSE 100 - Fallers
Standard Life (SL.) 211.75p -6.31%
Prudential (PRU) 596.50p -5.84%
Schroders (SDR) 1,019.00p -5.56%
ICAP (IAP) 616.50p -5.23%
Schroders Nv (SDRC) 924.50p -5.03%
Old Mutual (OML) 139.70p -4.32%
Aviva (AV.) 579.00p -4.22%
Barclays (BARC) 450.00p -3.43%
Royal Bank of Scotland Group (RBS) 373.25p -3.30%
Man Group (EMG) 489.25p -3.02%

FTSE 250 - Risers
Dimension Data Holdings (DDT) 53.25p +15.14%
Aveva Group (AVV) 906.00p +11.03%
Kesa Electricals (KESA) 217.00p +7.96%
Moneysupermarket.com (MONY) 112.00p +7.43%
Renishaw (RSW) 673.50p +7.07%
Misys (MSY) 181.50p +6.76%
IMI (IMI) 346.50p +6.62%
Aga Foodservice Group (AGA) 334.50p +5.11%
St. Modwen Properties (SMP) 434.75p +4.89%
DSG International (DSGI) 78.25p +4.33%

FTSE 250 - Fallers
New Star Asset Management Group (NSAM) 101.25p -31.12%
Catlin Group (CGL) 320.00p -8.24%
Premier Foods (PFD) 140.00p -5.25%
Benfield Group (BFD) 260.00p -5.11%
BlueBay Asset Management (BBAY) 255.00p -4.58%
JPMorgan Indian Inv Trus (JII) 444.00p -4.31%
William Hill (WMH) 370.25p -4.20%
Tullett Prebon (TLPR) 457.50p -4.19%
Beazley Group (BEZ) 157.00p -4.12%
BSS Group (BTSM) 335.50p -4.01%