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FTSE slightly higher midday

MIDDAY REPORT: Headline shares were slightly higher at midday, shrugging off expectations of a lower start on Wall Street and led up by the mining sector in the wake of firmer metals prices and excitement over yesterday's Lonmin bid news.

At high noon, the FTSE100 was up 19.5 points at 5,505.6 with the FTSE250 off 40.9 points at 9,090.6 and the FTSE Smallcaps 5.2 points better at 2,808.1.

NEW YORK

In the US, spread-bettors IG Index expect the Dow Jones Industrial Average to open around 48 points lower at 11,608, after closing up 40.3 points at 11,656.1 on Wednesday.

LONDON MARKETS

In the UK, on the macro front, the Monetary Policy Committee kept interest rates on hold at 5% as they continue to grapple with the twin evils of soaring inflation and a flagging economy.

BLUE CHIPS

Miners continued in Wednesday's vein as sector consolidation hopes encouraged investors and gains were underpinned by firmer metals prices.

Eurasian Natural Resources headed the leaderboard, up 60p at 1,077p, Antofagasta was up 21p at 563.5p, Vedanta Resources adding 61p to 1,889p, Anglo American, up 73p at 2,852p.

Continuing in commodity news, oil heavyweights ticked up on the back of rising crude prices, with BP up 11p at 532p, Shell taking on 21p to 1,764p and BG Group adding 35p to 1,105p.

Banks retraced earlier losses to turn higher on the back of numbers from Barclays.

Barclays rose 3.5%, adding 13p to 382p, while HBOS took on 8.5p to 341.5p and Lloyds TSB climbed 10.5p to 324.75p.

In other earnings news, Smith & Nephew added 23p to 590.5p after Europe's biggest medical device maker posted better-than-expected second-quarter adjusted earnings, as revenues hit $1bn for the first time.

On the downside, Friends Provident was among the biggest casualties, down 3.9p at 87.8p, after the insurer posted a 20% drop in first-half profit, at the low end of expectations, to £211m.

Cazenove said the shortfall reflects the slightly lower than consensus F&C Asset Management result and a deterioration in protection margins.

International Power also fell following the release of its interim figures, which revealed plant outages going forward.

The UK power generator posted a 19% rise in first-half operating profit, but said second-half operating profit is expected to be dented by £45m because of an extended outage at the company's Rugeley plant in the UK.

International Power shares lost 18.5p to 402.5p.

Hammerson was out of favour after its own figures showed the retail REIT swung to a pretax loss in the first half.

In reaction, Citigroup said the results contain some of the same worrying issues seen in Liberty International's numbers, released on Wednesday.

KBC Peel Hunt, meanwhile, cut its view on Hammerson to 'hold' from 'add' due to near-term sector uncertainties.

Hammerson slipped 12p to 977p, while Liberty fell 38p to 862p.

MIDCAP NEWS

Debenhams and Mothercare were under pressure, shedding 3.75p to 53.75p and 10.75p to 389.25p, respectively, after Altium Securities downgraded the two while also cutting its recommendation on small-cap JJB Sports.

Altium cut Debenhams to 'hold' from 'buy', and reduced Mothercare to 'sell' from 'hold', on valuation grounds.

Among mid-cap risers, Aquarius Platinum jumped 22.25p to 473.75p, following its full-year results and with the stock also riding on the back of sector consolidation hopes after Lonmin rejected a $10bn unsecured bid from Xstrata Wednesday.

On the broker front, Dana Petroleum rose 68p to 1,345p, helped by Goldman Sachs upgrading its recommendation to 'buy' from 'neutral' as it reviewed its exploration and production coverage.

SMALLCAP NEWS

An upbeat statement lifted Creston 3p to 48.25p. The insight and communications concern said the diversified nature of the group, with a heavy weighting in market research and direct marketing, is proving a resilient model as demonstrated by the first quarter revenue growth achieved in a volatile economic climate.

Story supplied by MoneyAM

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