BA and RBS shares lift FTSE
Monday November 09 2009
Blue-chip strugglers British Airways and Royal Bank of Scotland led the London market higher as investors shrugged off more losses from the pair.
Airline BA's latest plans for job cuts and savings helped shares up 6%, while RBS added more than 5% amid signs of stabilisation at the business.
The wider Footsie was in cautious mood ahead of key US jobs data, adding just 10.7 points to 5136.3 by the mid-session despite a 200 point gain for Wall Street's Dow Jones Industrial Average overnight.
In London, BA rose 12.3p to 198.6p as cost-cutting progress overshadowed a worse than expected interim pre-tax loss of £292 million.
Investors also overlooked more hefty operating losses at RBS, at £1.53 billion in the third quarter, to send shares up 1.92p to 37.13p.
Analysts were encouraged that RBS had seen signs of "plateauing" bad debt charges despite a further £3.2 billion impairment hit in the third quarter.
Another turnaround story, Rentokil Initial, fell 7% or 7.6p to 104.4p in spite of narrowing losses at its troubled City Link arm.
The pest control company delivered Q3 figures slightly ahead of expectations, but Numis Securities warned there was still much to be done in terms of restructuring and said that shares looked to have gone too far.
Among other companies reporting figures on Friday, sugar and ingredients group Tate & Lyle rose 1.7p to 458.6p after it reported first half trading slightly ahead of its expectations. Pre-tax profits fell to £50 million, but analysts were impressed by a 15% rise in sales volumes of Splenda sucralose.
Barclays and HSBC - both expected to report much healthier results next week than part-nationalised RBS and Lloyds - added 9.1p to 341.45p and 12.7p to 682.2p. Hedge fund company Man Group, meanwhile, cheered 3% or 11.1p to 335.9p as investors bought in following Thursday's better than expected numbers.
Press Association
