Morning Market: Firm start as eurozone debt worries subside

Banks and miners lead the way ahead and Greenland wells approval boosts Cairn Energy; Schroders dip after a Citigroup rating downgrade.

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by Phil Cozens on Jun 16, 2010 at 08:40

Wall Street's confident performance as eurozone debt worries receded in the wake of a stronger euro give stock markets an early boost led by banks and miners.

By 8.30am the FTSE 100 index was up 31 points at 5,250, with ex-dividends in 3i Group, Severn Trent and United Utilities accounting for just over one FTSE point.

The Mid-250 index was 63 points firmer at 9,943.

Aggreko was one of the morning's best performers at £14.78, up 33p, following a rating upgrade from Citigroup while Cairn Energy advanced 8.30p to 434p on receiving Greenland approval for two wells in its 2010 drill programme.

Royal Bank of Scotland ticked up 0.78p to 44.97p on the sale of its Pakistan operations and Barclays added 5p to 312p, helped by a positive note from KBW.

Intercontinental Hotels maintained its recent firm performance in the wake of upbeat US presentations, adding 18p more to £12.42 and Sainsbury put on 2.80p to 327p after a positive trading update.

Best of the miners was Rio Tinto, up 39p to £33.70, underpinned by an encouraging review from JP Morgan, but the broker was more cautious on Lonmin at £16.06, down 31p and Fresnillo, 11p easier at £10.59.

Royal Dutch Shell rose 21p to £17.41 among brighter oils where hard-hit BP recouped 5p to 347p.

Properties were also in good form under the lead of British Land at 471p, up 6p.

Defensive stocks remained neglected with drug shares parlticularly dull with AstraZeneca off 22p to £30.57.

Schroders dipped 25p to £13.40 as Citigroup downgraded to sell from buy, cutting its target to £12 from £13.65 and Man Group shed 3p to 242.5p as its AHL flagship fund net asset value fell 3.12% last week.

Among the mid-caps Filtrona scored a 28p rise to 224p following an upbeat profits forecast and Bellway rallied 14p to 635p after a cautious trading update earlier this week.

Among the smaller caps Interlek stood out at 30.5p, up 5.75p, following a £23 million bid from Teledyne and Kea Petroleum added 2.5p to 24.88p on finding gas at a New Zealand well.