News

News of more furnace closures at Xstrata raising concerns over global demand for commodities has knocked mining stocks for six today.

Xstrata has suspended another five ferrochrome furnaces in South Africa, taking the total suspended capacity to 906,000 tonnes or 52% of annual operating capacity. Other groups are lower on worries on Chinese demand, with Kazakhmys, Lonmin and Anglo American suffering the most.

Rio Tinto is lower but performs relatively well in comparison with its peers after Credit Suisse named it as its top pick in the sector, and gave the stock an "out-perform" rating, with a price target of 2700p. The Swiss bank believes Rio's shares have been "massively oversold".

Credit Suisse also picks Rio's erstwhile suitor BHP Billiton to out-perform with a 12-month target price of 1500p.

Bright spots are hard to find today but Sage Group firms a tad ahead of results this week while William Morrison is marginally higher ahead of a third quarter sales due on Thursday.

On the bid front, no-frills airline Ryanair has launched all cash offer for Aer Lingus in a new attempt to gain control of its rival. The offer is worth €1.40 for each Aer Lingus share, half of the value of its original offer in 2006. The bid values Aer Lingus in total at €748m.

Borrowers who fail to maintain mortgage repayments will be given a six-month breathing space under a plan due to be announced today by the Royal Bank of Scotland, the Times has learnt. The bank, which owns NatWest, is expected to promise not to repossess homes for six months from the date when customers first admit that they have a problem.

Elsewhere, fund manager New Star slumped after the fund manager's request to have its shares suspended was denied as it continues talks with its bank syndicate.

Earlier in the day, the group requested its shares be suspended and said it is in "advanced and constructive discussions with its bank syndicate".

Rival and rumoured possible New Star bidder Aberdeen Asset Management saw profits creep ahead in the year ended 30 September, although gross inflows were largely offset by higher redemptions due to increased risk aversion. Profit before exceptional items and amortisation of intangibles rose to £95.1m from £94.3m in 2007 on revenue up to £430.1m from £347.8m a year ago.

Plastics firm Victrex has experienced a downturn in orders since the second half of November. Sales volumes in October had remained vibrant at 218 tonnes, in line with average run rates seen in the year to 30 September 2008, but volumes in November dropped to 118 tonnes, which the company believes is due to customers running down inventories in this uncertain economic climate.

Debt-laden sportswear retailer JJB Sports tumbles despite selling off the leases on four stores for £3.4m. Traders are more concerned that Barclays, which is owed around £60m by JJB Sports, has appointed Grant Thornton to advise the retailer on its future business plans.

Investors lost their appetite for share in Zetar as the snack foods group revealed the size of its exposure to the collapse of Woolworth's retail arm. Woolworth's accounts for 3% of Zetar's turnover. The amount owed to Zetar at the time of the appointment of the administrator at Woolworth's was £970,000, excluding VAT.

Printer St Ives reports little improvement in its trading backdrop in recent months. "Overall, the economic outlook remains uncertain, visibility is extremely short and rising input costs coupled with volatility in demand is increasing the pressure on margins," it says.

Engineering and construction contractor Balfour Beatty has acquired Colledge Trundle and Hall, an automatic energy control systems specialist. Balfour Beatty is paying £2.85m for Colledge Trundle and Hall (CTH), which specialises in the design and installation of automatic energy control systems for buildings.

Theme park queue system specialist Lo-Q has agreed a one year trial of its VQ2020 system with the Australian Theme Park, Dreamworld. Dreamworld is located in Coomera, Queensland. The Park will be running the system from 15 December 2008 and it will allow virtual queuing on the park's major attractions.

Heritage Oil is wanted after an upbeat update on its oil drilling in Uganda.

Chief executive Steve Rowley has gone out on a high at business services software supplier Anite, which has reported a rise in half year pre-tax profit and a share buyback of up to £10m over the next two years.

FTSE 100 - Risers
Legal & General Group (LGEN) 68.70p +2.08%
HBOS (HBOS) 92.50p +1.31%
GlaxoSmithKline (GSK) 1,131.50p +1.03%
Imperial Tobacco Group (IMT) 1,633.00p +0.93%
Schroders NV (SDRC) 648.50p +0.86%
Sage Group (SGE) 167.20p +0.66%
Inmarsat (ISAT) 436.50p +0.52%
Morrison (Wm) Supermarkets (MRW) 243.25p +0.31%
Thomas Cook Group (TCG) 163.10p +0.25%
British Energy Group (BGY) 749.50p -0.07%

FTSE 100 - Fallers
Lonmin (LMI) 741.50p -12.97%
Anglo American (AAL) 1,390.00p -9.39%
Kazakhmys (KAZ) 235.75p -9.24%
Eurasian Natural Resources (ENRC) 254.75p -8.45%
Vedanta Resources (VED) 561.00p -8.26%
Xstrata (XTA) 864.50p -7.09%
International Power (IPR) 242.25p -6.01%
Whitbread (WTB) 790.50p -5.95%
Kingfisher (KGF) 112.60p -5.77%
Stagecoach Group (SGC) 165.20p -5.44%