News

London has been lifted by a mad rush to buy banking shares after US banking giant Citi released second quarter losses that were not as bad as feared.

Royal Bank of Scotland, Lloyds TSB and HSBC all advance strongly while even Barclays is wanted despite receiving acceptances from just 19% of shareholders for its open offer. The apathetic response from shareholders means Qatar Investment Authority, Challenger, China Development Bank, Temasek and institutional shareholders will end up with the rest.

Kazakhstan's ENRC and Kazakhmys plus the Ukraine's Ferrexpo lead miners lower in line with falling metal prices. Copper prices fell on concerns demand from China would slow as economic growth eases. Diversified miner Xstrata also posts substantial losses.

Reckitt Benckiser falls back after consumer products group L'Oreal trimmed its guidance for full-year like-for-like sales growth.

Engineer Invensys reports a satisfactory start to the new financial year. Overall operating performance during the first quarter ended 30 June 2008 was in line with expectations.

RBS gave British American Tobacco a lift, raising its recommendation on the firm to 'buy' from 'hold' saying it thinks tobacco stocks look more attractive than food and household goods companies.

JP Morgan has trimmed its target price on the fashion retailer Next to 1,050p from 1,100p saying it expects retail trends to remain weak next year. The broker, which has a 'neutral' stance on Next, has reduced its earnings per share forecasts on the company by 2% for this year and by 7% for next year.

JPM has lowered its target price on financial news provider Thomson Reuters to 1,900p from 2,000p, but kept its 'overweight' rating on the company.

Aberdeen Asset's funds at the end of June rose to £113.6bn from £107.2bn three months earlier despite a decline in performance. Net new funds amounted to £877m and acquisitions added a further £7.3bn offsetting a fall of £1.8bn in investment performance.

Kier says that despite very tough market conditions for both housing and property it expects to report full year underlying profit before tax in line with current market expectations and ahead of last year's result. It is closing four out of five of it shousing offices and plans to reduce the headcount in the residential division by 60%.

Electrocomponents says organic growth has slowed compared to the first half last year. The distributor said group sales were up 1% in the three months to June with international sales up 4% and UK sales down 2%.

Bid speculation has lifted Cape Lambert Iron Ore as it confirmed it met with people from Merrill Lynch and Evraz Group in Singapore yesterday, but said no information from that meeting needs to be advised at this time.

Shares in educational training firm ILX Group chalked up good gains after the company said its strong momentum had continued into its new financial year.

FTSE 100 - Risers
Royal Bank of Scotland Group (RBS) 193.10p +7.58%
British Airways (BAY) 242.25p +6.60%
Lloyds TSB Group (LLOY) 320.00p +6.49%
Admiral Group (ADM) 844.50p +6.29%
Wolseley (WOS) 303.00p +6.04%
Barclays (BARC) 302.00p +3.96%
Invensys (ISYS) 270.25p +3.64%
InterContinental Hotels Group (IHG) 718.00p +3.53%
HSBC Holdings (HSBA) 791.25p +3.50%
Legal & General Group (LGEN) 99.00p +3.45%

FTSE 100 - Fallers
Ferrexpo (FXPO) 275.50p -6.37%
Reckitt Benckiser Group (RB.) 2,339.00p -5.99%
Eurasian Natural Resources (ENRC) 1,052.00p -4.36%
Kazakhmys (KAZ) 1,338.00p -3.88%
Xstrata (XTA) 3,380.00p -3.57%
Tesco (TSCO) 375.80p -3.34%
John Wood Group (WG.) 388.25p -3.30%
Rio Tinto (RIO) 4,972.00p -3.17%
Vedanta Resources (VED) 1,808.00p -3.00%
Petrofac Ltd (PFC) 625.00p -2.95%