Authorised and regulated by the Financial Services Authority

Early bargain hunting again hits a wall in London

After the barrage of negative press comment over the weekend, there were signs of some early value hunting in London, but once again sellers appeared into any strength. By mid-morning, the FTSE 100 index was up fifteen points, and the miners were generally the main winners on healthy commodity prices and M&A talk.

There was a story that Lakshmi Mittal was looking to take a stake in Rio Tinto to protect his future iron ore prices, and the latter’s shares were up almost 2%, but elsewhere the focus was again on beaten down stocks.

Shares in Taylor Wimpey initially rose then edged back as it announced write-offs of £660m and confirmed it was talking to shareholders over a placing and open offer. Other builders are down in sympathy and the very cautious comments suggest we will in die course see some insolvencies in the sector.

Trinity Mirror dropped by more than a quarter after it warned that full-year operating profits would be 10% lower than forecasts as advertising market conditions continue to deteriorate. This is another highly cyclical sector, and spells further worries for other media stocks, to which we remain bearish.

There was a little good news on the takeover front, as Cable & Wireless confirmed it had raised its offer for Thus with a cash offer of 180p per share, and this might do the trick with the latter’s shares settling 20% up at 174p.




Head of Research at Blue Index, specialists in trading Contracts For Difference
30/06/2008

< back

Free weekly trading updates straight to your inbox

Your Full Name

Your Email Address

Read terms and condtions