Friends Provident deal boosts FTSE |
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| Strategic Finance | |
| Written by Gary Howes and Sharecast | |
| Tuesday, 11 August 2009 | |
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The FTSE 100 is up higher than expected courtesy of some good company reports and the Friends Provident and Resolution deal.
The FTSE 100 (INDEXFTSE:.FTSE) is 0.39% up at 4,740.66 by 9:34am - a stronger start than had been anticipated. Friends Provident shareholders will get 0.9 Resolution shares for every Friends share held and may elect to receive 79.4p in cash for each of the first 2,500 shares. Power generator International Power (LON:IPR) reported a rise in profit in the six month period, thanks to improved contributions from Australia and Asia. Profit from operations rose to £555m in the six months ended 30 June compared with £495m last time, up 12% or 2% at constant currency. Hotel group Intercontinental (LON:IHG) held its interim dividend despite a tough first half that saw revenues tumble and the group post a loss after one-off items. Banks are weak after the FT is reported that Lloyds Banking's tentative plans to raise an estimated £15bn-£20bn in a rights issue to reduce its reliance on the government face a wall of scepticism in Whitehall and among investors. Royal Bank of Scotland is also lower. Bakery chain Greggs lifted its interim dividend to a record level as it shrugged off the impact of the recession to lift underlying half-year profits by 7.3%. Pre-tax profits came in at £16.5m for the 26 weeks to 27 June, against £23.4m last time, though stripping out one-offs the comparable figure was £15.4m. Support services group Interserve is racing ahead after profits grew by almost 19% during the first half. Melrose Resources said gas samples obtained from its Kaliakra No.2 well in Bulgaria confirmed that the reservoir has very good properties, with an average porosity in excess of 30% high gas productivity. Europe's leading shares are reversing some of yesterday’s losses in early dealings Tuesday morning. In Germany, Volkswagen is leading the way after dropping on Monday after a broker downgrade. Fellow carmakers BMW and Daimler are also going well. Across the markets, the German DAX is up 21 points at 5,438 with the French CAC rising 17 points to 3,521. The Swiss market has gained 2 points to 6,009. Swiss recruitment firm Adecco has agreed terms to take over UK peer Spring Group, though shares in the group dropped after it reported a second quarter loss of €147m.
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