Whitbread, Carpetright shares decline after trading updates
By Simon Kennedy, MarketWatch
LONDON (MarketWatch) — Modest gains for oil majors helped offset some losses for mining stocks in a muted London trading session Tuesday, with hotel and restaurant operator Whitbread PLC also falling after a trading update.
The country’s benchmark FTSE 100 index (UK:UKX 5,854, -6.50, -0.11%) fell less than 0.1% to 5,856.70 as European bourses remained in a tight range after six consecutive winning sessions for the Continent’s stock markets. Also see Europe Markets.
Shares in heavyweight oil major BP PLC (UK:BP. 461.40, +3.05, +0.67%) (BP 43.43, +0.19, +0.44%) rose 0.9% and Royal Dutch Shell PLC (UK:RDSA 2,070, +3.50, +0.17%) (RDS.A 65.42, +0.42, +0.65%) rose 0.5%.
Credit Suisse on Tuesday lifted its 2011 oil-price target and raised its earnings forecasts for integrated oil companies, citing an “astonishing” recovery in global oil demand since late September.
The broker said BP is its long-term top pick, as it believes the market is too pessimistic about the eventual costs of the Macondo oil spill.
Smaller exploration and production group JKX Oil & Gas PLC (UK:JKX 323.40, +3.50, +1.09%) rose 1.9% after the initial tests on a Ukraine well exceeded the firm’s expectations.
Mining stocks were mostly lower, with Rio Tinto PLC (UK:RIO 4,447, -32.00, -0.71%) (RIO 71.20, +0.93, +1.32%) dropping 1.1% and Lonmin PLC (UK:LMI 1,855, -30.00, -1.59%) down 1%.
Xstrata PLC (UK:XTA 1,466, +4.00, +0.27%) bucked the trend, rising 0.6% after UBS upgraded the company to buy from neutral.
Also on the downside, shares in hotel and restaurant group Whitbread (UK:WTB 1,778, +12.29, +0.70%) dropped 2.9% after a trading update. The group reported a 31% jump in sales at its Costa Coffee chain, but a more muted 1.3% rise across its restaurants.
Among smaller companies, Carpetright PLC (UK:CPR 776.00, -20.00, -2.51%) dropped 3% after the flooring retailer reported a 28% drop in underlying six-month profit.
