News

Footsie has bounced back after a brief dip into the red, with company updates helping drive the index higher, despite declines in the mining sector.

Kazakh miner ENRC slips after announcing it is cutting back production and spending during the fourth quarter as the sharp slowdown in the global economy hits demand. The group is also slashing capital expenditure for the full year to way below the previously projected $1.7bn.

Ferrochrome producer International Ferro also falls. It is to cut production and delay expansion plans until the outlook becomes less uncertain after a sharp downturn in stainless steel demand since September.

In contrast, insurers are wanted this morning, despite a profit warning from Swiss Life. Car insurance group Admiral Group leads the sector higher, followed by Aviva and Old Mutual.

Also on the rise are Scottish & Southern Energy and AMEC after well received results today. Scottish & Southern Energy saw profits more than halve during the first half, although it has maintained its prediction of a "modest" increase for the full year. Adjusted operating profit before exceptional items for the six months to 30 September fell 54.5% from £664.7m to £302.6m, due to Generation and Supply. Reported profit before tax plunged to £171.1m from £723.6m last time.

Engineer and project management giant AMEC is still confident of delivering EBITA margin in excess of 6.5% in 2008 following a record year to date. The firm, which has been awarded contracts with an aggregate value over £700m since 1 July, also expects to hit its target margin of 8.5% in 2010.

Supermarket giant Sainsbury edges higher after underlying profit before tax rose by 13.3% at the interim stage to a better than expected £272m. Total sales jumped 7.6% to £10,756m from £9,998m. Elsewhere in the retail sector Marks & Spencer is lower on its first day of trading in ex-dividend form.

Property giant Land Securities has scrapped its planned three-way demerger after net assets plunged in the first half of the year. LandSecs' net asset value dropped by 19.7% to 1,660p after a £1.72bn write-down in the value of its portfolio, pushing the group into a loss of £1.74bn for the half-year to September. The interim dividend rises by 3% to 33p.

Newsagent WH Smith has seen like-for-like sales at its High Street stores slide by 4% in the first 10 weeks of its new financial year, though it says this is in line with management expectations. Like-for-like sales at WH Smith Travel were flat during the period, despite a fall in the number of people passing through airports.

Aviation services and newspaper and magazine distributor John Menzies has cut 600 jobs to cope with the downturn in flight schedules due to the current economic slowdown that prompted a profit warning in October.

Tullow Oil expects total production for 2008 to average about 67,000 barrels of oil equivalent per day (boepd), with strong production from Africa and Asia offsetting lower figures from the UK.

Morgan Crucible is wanted after an upbeat trading update. The carbon, ceramic and magnetic materials supplier expects full year performance to be in line with expectations, with an additional boost provided by the strength of the US dollar.

Computer services group Dimension Data has reported strong full year results, but warned that the global economic slowdown and strength of the US dollar will impact results in the current year.

Water and waste management company Pennon Group is dented by a downgrade from Goldman Sachs. The US bank has downgraded Pennon from "neutral" to "sell" and shifted its price target lower to 543p from 562p on concerns about the waste side of the business which is suffering from the sharp decline in the price of paper.