News

London afternoon: Man Group leads advance

• 06 Jan 2009

  With Wall Street expected to open higher, London's advance has been given fresh impetus.
  
  Retailers and miners continue to feature prominently among the best performers but it is hedge fund manager which leads the way. The company's AHL funds are believed to have fared much better than rivals last year, many of which were hit by the slump in commodity prices. Swiss bank Credit Suisse has upped its 2009 earnings forecast for Man by 19% on the strength of AHL's performance, while stockbroker Evolution Securities has reiterated its "buy" recommendation in a broker note.
  
  Elsewhere in the financial sector, private equity group and inter-dealer broker are both going well, but banks react negatively to the FSA's decision to list its ban on short selling banking stocks. Citigroup has also warned against buying into the theory that banks look cheap. "Despite trading at 0.9x 2009E price to tangible book, the risk of banks making retained losses and raising more capital may not be fully priced in yet," said Citi analyst Simon Samuels.
  
  and lead the banking sector down, but sub-prime lender continues to advance strongly on hopes that its application for a banking licence will be granted. Yesterday Barclays announced it controlled around 5% of Cattles's share capital through funds it manages..
  
  High street fashion chain is wanted after it said its full year profit forecast remains in line with City expectations of around £415m to £435m. The clothing retailer saw a 1.9% drop in sales in the half year to Christmas Eve, with like-for-like sales coming in at the bottom end of expectations.
  
  The response to department store results has been even more enthusiastic. Like-for-like sales fell 3.5% during the 18 weeks ended 3 January, in line with expectations. Profit before tax and EBITDA for the 18 weeks were both higher than last year due to "the increase in gross transaction value, the continuing tight management of costs and stocks and our decision to focus on the levers that drive cash margin".
  
  A refusal to slash prices to boost sales helped out-of-town based home wares retailer increase margins in the past 26 weeks, though sales felt the impact. Total sales for the 26 weeks to 29 December rose 2.3% to £201.8m, from £197.4m. Like-for-like revenues fell by 5.6%.
  
  Defensive favourite is lower, however, after US bank Goldman Sachs rated the water company's shares a "sell" on fears that deflation and increased regulatory burdens will erode profitability in 2009. Goldman Sachs has chopped its price target for the stock by almost a fifth to 555p.
  
  Tobacco giant fails to get a lift from positive comment from JP Morgan. The US bank has raised its 2009 and 2010 earnings estimates by 3% to factor in the positive effect of currency translations and lower interest rates.
  
  Carbon, ceramic and magnetic materials supplier is to increase its stake in technical moulding and vehicle integration business NP Aerospace by 11% to 60% for £12.2m.The Coventry-based firm develops, manufactures and markets ballistic protective and other composite products in the defence and civil sectors. It has a strong position in the UK with the Ministry of Defence.
  
  Irish building materials giant has maintained its forecast of a profit for 2008 of €1.6bn despite a steadily deteriorating trading outlook in the second half. CRH added that about €1.6bn would represent a mid-teen percentage decline on the 2007 outcome of €1.9bn, and in line with guidance provided in the update of 11 November. Earnings per share will fall by a lower amount.
  
  Another day, another deal for data search software group , which has signed a multi-million dollar license agreement with oil giant Statoil. Cambridge-based Autonomy will license its Intelligent Data Operating Layer software to the Norwegian oil and gas company. The news comes just a day after FTSE 100 firm Autonomy announced a big license agreement with defence giant BAE Systems.
  
  Engineering and construction firm has bought the interests in a military housing privatisation project at Lackland Air Force Base in San Antonio, Texas.
  
  Feed supplier and flour miller first quarter of the current year to August was ahead of budget and last year, but trading is getting tougher.
  
  Shareholders in oil and gas group are applauding the company's announcement of a successful drilling in the UK North Sea. , which has a 10% in the block 42/13 licence, also rises sharply on the news.
  
  Drug developer said the Marketing Authorisation Application (MAA) for Cerepro, its gene-based therapy for brain cancer, has cleared the validation stage. The Cerepro MAA application now commences formal review.