RAMSEY CROOKALL
26th July
Evening Report
The FTSE 100 closed up 0.1%, following a bumpy session, with investors reluctant
to take up any positions until there is more clarity on whether the US will raise
its debt ceiling and avoid a default. Earnings news is mixed, with BG Group up 4.3%
on well-received 2Q earnings, but BP down 2.6% after its results fail to impress.
Euro-zone money supply figures and UK CBI industrial trends are announced in early
trading, while US durable goods data is announced prior to the US open.
After beating market expectations the oil and gas behemoth BG Group saw its share
price head north. The company's underlying second-quarter net income came in a shade
ahead of expectations at $1.15bn, up from a restated $918m the year before. Underlying
profit before tax saw a sharp incline from $1.50bn to $2.06bn on revenue that grew to
$5.12bn from $4.08bn.The group said the improvement reflected higher commodity prices
and a 3% increase in exploration and production (E&P) output.
In contrast, sector peer BP experienced a drop in its share price after the benefits of
increased profits as a result of higher oil prices were offset by lower production as
a result of the oil spill in the Gulf of Mexico. The rising price of oil and gas had meant
profits of £3.2bn for the 3 month period to the end of June but this paled in comparison
to the £10.3bn loss incurred last year.
Shares of drugs maker GlaxoSmithKline surged 1.3% to 1,381p in midday trading in London.
Despite the pharmaceutical giant reporting a 4% decline in quarterly revenue,
the company’s shares gained momentum after it gave a rosy outlook for 2012 and recorded a
5% rise in sales, excluding the pandemic flu product segment.
THE FTSE 100 closed Up 4 @ 5929
THE DOW JONES at 16:40 Down 60 @ 12531
NASDAQ COMP at 16:40 Up 2 @ 2845
Exchange Rates
GBP – USD 1.6398
GBP - EURO 1.1311
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