FTSE 100 movers: Banks and insurers lifted by Deutsche Bank upgrade
Fri 12 Oct 2012
LONDON (SHARECAST) - Banks and insurers have been buoyed by Deutsche Bank upgrading the sectors to 'overweight'.
However, it was financial services provider Hargreaves Lansdown which topped the leader board in the morning session, after it said it had got off to a "pleasing" start to its new financial year.
Hargreaves Lansdown's revenue, assets under administration (AuA) and client numbers all hit record levels in the July-September quarter, traditionally the firm's quietest period.
In line with this, Standard Chartered, Lloyds, and Prudential were all strong risers in mid to late afternoon.
Smith & Nephew regained some of the losses seen over the past couple of days following Wednesday's news that the medical equipment group was the subject of a sell note from Societe Generale. The shares also went ex-dividend on the same day.
Meanwhile, analysts at Credit Suisse have issued a short term trading sell on miner Antofagasta, on which they are broadly neutral, with a target price of 1,250p.
The Swiss bank sees three short term drivers of underperformance. Firstly, consensus production estimates look too high by up to 10% over the period 2013-16. Secondly, the shares have outperformed peers and the copper price and valuation is at the top end of its ten year range. Third, copper price may underperform other commodities in the near term (given the resilient performance year-to-date and improving mine supply in the second half of 2012).
Evraz was also heading lower following a downgrade by Credit Suisse to underperform, which said that the demand recovery for China commodities is likely to take longer than previously thought. It believes the commodity price scenario has "major negative implications for iron ore and coking coal names and for their first derivative-vertically integrated steels", adding that, "importantly, we believe the story of too-high commodity demand growth recovery expectations is likely to be repeated in 2013 and therefore we maintain our view positioning".
The drop in the share price is also potentially linked to reports on the Russian steel maker's decision to temporarily close its Czech steel production line as a result of low demand. The firm is also planning to run down its raw materials inventory, a company spokesman is reported as saying. Sector peer Kazakhmys was also a heavy faller.
GKN and IMI were both dragged lower by industrial materials provider Morgan Crucible, which has delivered a profits warning as trading conditions have deteriorated across most geographies, particularly in Europe and China.
FTSE 100 - Risers
Hargreaves Lansdown (HL.) 713.00p +3.63%
Standard Chartered (STAN) 1,432.50p +2.65%
Lloyds Banking Group (LLOY) 39.79p +1.38%
Intertek Group (ITRK) 2,775.00p +1.20%
Prudential (PRU) 852.50p +0.95%
Aviva (AV.) 330.20p +0.95%
Resolution Ltd. (RSL) 216.60p +0.74%
Admiral Group (ADM) 1,093.00p +0.74%
Pennon Group (PNN) 723.00p +0.70%
British American Tobacco (BATS) 3,230.00p +0.62%