Miners led London’s FTSE 100 to a strong close on Wednesday after the volatile sector was lifted by interim results from Antofagasta.
The senior index ended the session up 1.1 per cent to 5,528.1, an advance of 57 points. The FTSE 250, however, ended flat at 9,137.1, a reflection of sentiment in the building sector after Taylor Wimpey’s disappointing results.
There was support for Antofagasta after it reported an 8.8 per cent rise in interim net earnings of $792.8m, and stood by its annual production guidance. The Chilean copper miner’s stock was 3.9 per cent higher at 592p.
Vedanta Resources rose 3.9 per cent to £18.53 and Kazakhmys was 2.1 per cent higher at £13.39.
One of the best performers of the session was security services provider G4S, up 5.9 per cent to 224p after it reported a 26 per cent rise in interim profit before tax of £174.8m, in line with forecasts.
Taylor Wimpey, the mid-cap housebuilder, reported a £1.54bn loss for the first half and cancelled its dividend as the housing market slum continued to take a heavy toll. The company told investors it was seeking to alter its banking covenants as the downturn continued.
“The board remains convinced of the fundamental value of the business over the medium and long term and our primary focus is to amend certain of the existing borrowing agreements,“ it told investors. Shares in the company were 7.2 per cent lower at 48¼p.
The fresh insight into the extent of the damage being done to bottom lines in the industry brought the rest of the sector lower. Persimmon lost 1.6 per cent to 345½p, Bovis Homes was 3.1 per cent weaker at 427½p and Barratt Developments lost 2 per cent to 132½p.
Royal Bank of Scotland unveiled a boardroom reshuffle in a well-received move to address shareholders concern at corporate governance thrown up by its recent rights issue. RBS said British Land’s chief executive Stephen Hester was appointed to its board as non-executive director along with John McFarlane, formerly of Standard Chartered and Citibank; and Arthur Ryan, the ex-chairman of Prudential Financial. RBS’s shares rose 1.8 per cent to 221¾p.
Media stocks were stirred up by a wide-ranging note on the sector from Goldman Sachs. Among a series of changes to its stance on companies across Europe, the investment bank added BSkyB to its “conviction buy” list, sending shares in the pay-TV operator 1.3 per cent higher to 456p.
It also raised its rating on Trinity Mirror to “buy” from “sell”, helping shares in the newspaper publisher 3.5 per cent higher to 103p.
Regional newspaper company Johnston Press fell 6.9 per cent to 47½p after it scrapped its interim dividend and reported an 18 per cent fall in pre-tax profits and said the outlook was worse. Goldman cut its rating on the company to “sell” from “neutral”.
Market researcher Taylor Nelson Sofres fell 0.7 per cent to 267p after its German offer GfK dropped its friendly takeover offer in the face of continued, hostile rivalry from WPP. TNS continued to argue WPP’s offer, worth 268.7p per share, undervalued the group.
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