Investors warm to sale in Chile
PUNTERS piled in yesterday on news that Chilean miner Antofagasta had managed to turn water into cash.
It sold its Aguas de Antofagasta water utility business to a Colombian outfit for more than £642m and its shares soared to close to the top of the leaderboard – up 4.7pc.
Diego Hernandez, the chief executive of the copper miner, said it will use the money to focus efforts and investments on new mining projects, and analysts predicted it could mean M&A deals or that it will return cash to shareholders. Investors hoped it could be the latter and shares climbed 35p to 784.5p.
Miners were in favour across the board after a rebound in base metal prices.
Even a rather feeble first-quarter update from Anglo American got a warm reception and its shares were top of the benchmark index, up 48p or 4.73pc to 1062p.
Mexican silver miner Fresnillo rose 24.5p to 727.5p and Rio Tinto (up 94.5p to 2958p) and BHP Billiton (up 48.5p to 1531.5p) also benefited. The wider market was in positive territory despite continued concerns about Greece’s debts.
Augustin Eden, analysts at Accendo Markets, said there was a focus on Greece in ‘the absence of much else in the way of meaningful economic drivers for the UK benchmark index’. The FTSE 100 picked up by 25.43 points to 7053.67 – more than 40 points shy of its all-time high. The FTSE 250 rose 49.18 points to 17684.73.
But the US was in a more jovial mood. Buoyed by EBay and Microsoft, the Nasdaq Composite closed at 5056.06, beating its alltime closing high, last reached in March 2000 before the dotcom crash.
The S&P 500 rose above its record close of 2117.39 during trading and Wall Street gained 20.42 points to 18,058.69.
Scribblers at HSBC took a look at oil stocks and decided that the share price fall of Royal Dutch Shell, following its plan to stump up £47bn to buy rival BG Group (down 3.5p to 1167.5p) makes its shares a little more attractive.
They raised their recommendation from sell to hold and rated under-pressure rival BP a buy. BP announced it has agreed to sell its stake in one of Europe’s biggest gas pipelines to Antin Infrastructure Partners for £324m. Antin’s Central Area Transmission System is a pipeline and processing facility that transport gas from North Sea fields to an onshore receiving terminal in Teesside.
But BP will retain rights to use the system. Shares in BP rose 4.4p to 484.15p and Shell advanced 10.5p to 2110.5p. Analysts at Citi- group rated utility stocks as a sector that could be favoured as a protection against market volatility caused by the election and United Utilities rose 11p to 984.5p, SSE lifted 22p to 1588p, Centrica advanced 3.8p to 263.9p while National Grid climbed 5p to 888.8p.
A bid for set-top box maker Pace from US telecommunications firm Arris saw it shares rocket nearly 35pc or 115p to 447p.
Small cap oilrig-maker Lamprell got an upgrade from analysts at Investec who rated it a buy with the target price increased to 145p as they liked its cost- cutting and progress on its turnaround, but investors were slow to be convinced and the shares fell 0.5p to 130p.
Israeli digital advertising group Matomy Media Group, which is part-owned by advertising giant Publicis, issued a profit warning. It blamed industry changes that affected the amount of available media that it can buy for the advertising campaigns it operates for its clients. It now believes that revenue will be more than 8pc below forecasts.
House broker Shore Capital said: ‘Unfortunately, this change, as well as weaker trading, is affecting Matomy as it limits the supply of available traffic it can buy.’ Shares tumbled 30p to 142p. FTSE fledgling air charter company Air Partner reported a pre-tax profit down 36.5pc to £2.6m but its 15.4p a share final dividend was an improvement on last year’s 14p. Shares eased 13p to 345p.
Over on AIM, Faberge owner and gemstone miner Gemfields reported results from its latest ruby auction in Jaipur in India. The auction of some of its lower-quality rubies from its mine in Mozambique raised £10.7m and it said 3.99m of the 4.03m of carats on offer were sold at an average value of US$4.03 a carat (£2.70). Shares slipped 1.75p to 64p.
An activity report from Sula Iron & Gold on its gold exploration programme and discussions with strategic partners helped the shares up 0.05p to 1.1p.
Victoria Oil & Gas was powered up by news that its second of two power stations in Douala in Cameroon were now up and running and now supply 50 megawatts of electricity to the local grid. Shares climbed 1p to 84p. ÷ THERE was welcome news for investors in Yorkshire potash developer Sirius Minerals yesterday. Trading in the company’s shares was temporarily suspended pending the outcome of a Redcar and Cleveland Borough Council planning meeting. Councillors unanimously gave the thumbsup for its York Potash mine and mineral transport system, a big regulatory hurdle for the group. When shares returned to trading they closed up 7.7pc, or 1p, to 14p.