MW: British shares advance as earnings, deal hopes boost
FTSE 100 index up 1%; Icap shares higher after upgrade
By Sarah Turner, MarketWatch
LONDON (MarketWatch) -- The top British share index climbed on Monday, with earnings, deal speculation and broker moves helping the advance.
The FTSE 100 index (UK:UKX 5,086, +24.80, +0.49%) rose 1%, or 50.01 points, to 5,110.93. Other European shares were higher, as were U.S. stock futures, with Dow Jones Industrial Average futures up 45 points. See Europe Markets.
Shares across Europe have been under pressure since the start of the year, with the FTSE 100 index down 5.5% year-to-date, amid worries about debt in Europe and policy tightening in China.
However, demand for metals recovered a bit on Monday, with gold futures up $20.80 at $1,073.40 an ounce and copper futures up 6 cents at $2.92 per pound.
Miners were advancing along with metal futures and earnings news also helped the sector, with Xstrata (UK:XTA 985.80, +34.80, +3.66%) shares climbing 5.2%.
The coal and copper miner's second-half profit collapsed 97% as prices on metals fell, but the Anglo-Swiss miner said it's showing its confidence in the future by restoring dividend payments.
It will pay a final dividend of 8 cents a share on April 23. Read more on Xstrata.
Still in the sector, Randgold Resources (UK:RRS 4,481, +249.00, +5.92%) shares jumped 7.9%.
Its fourth-quarter net attributable profit jumped to $32.1 million, from $9.1 million at the same point a year ago, after fiscal-year gold production rose 14%.
Given the profit increase, the firm said that it's increasing its annual dividend by 30% to 17 cents per share.
Anglo American (UK:AAL 2,326, +51.00, +2.24%) shares were up 3%. It said that it will fully support a move by its Anglo Platinum unit to raise around $1.6 billion by issuing new shares.
Turning to potential deals and International Power (UK:IPR 322.00, +8.10, +2.58%) shares were up 3.6%.
The Independent newspaper reported Monday that France's GDF Suez (FR:GSZ 26.43, +0.21, +0.78%) is mulling a bid for the firm which is expected to include a cash element. Talks between the firms collapsed last month, according to the report.
In broker news, Icap (UK:IAP 309.64, +15.50, +5.27%) shares were up 5.7% after Credit Suisse upgraded the interdealer broker to outperform from neutral, citing valuation following a 30% drop in the share price so far in 2010.
The broker said it had cut its pretax profit forecast for fiscal 2010 by 6% and for fiscal 2011 by 15% following a weak trading update last week, but said the price to earnings multiple for fiscal 2011 "is extremely attractive, given the diversified business, upside on voice margins and the improving quality of earnings."
