FTSE 100 climbs as Q4 UK GDP growth revised up to 0.3%, US futures point to flat open ahead of data

Overview: the FTSE 100 recovered from yesterday’s falls, climbing 0.5% today after US stocks trimmed early losses on Thursday and Asian markets rallied earlier today. The market was supported by today’s reading of the Q4 UK GDP, which was revised upwards to an increase of 0.3% from 0.1%.
Serco Group (LSE: SRP) was the top performing blue chip today, rallying 6% after releasing its final results. Other notable risers included pharmaceutical company AstraZeneca (LSE: AZN) and retailer Next (LSE: NXT), which gained slightly more than 2%.
Part-nationalized banks Lloyds (LSE: LLOY) and RBS (LSE: RBS) were at the bottom of the index with losses of 5.5% and 2.5%. Commercial property companies Hammerson (LSE: HMSO) and Segro (LSE: SGRO) lost 2.5% and 2% respectively. Telecom group BT (LSE: BT.A) also shed 2%. Credit information group Experian (LSE: EXPN) and mobile operator Vodafone (LSE: VOD) lost slightly more than 1.5%, while another property stock British Land (SLE: BLND) was down 1.3%.
Futures for the Dow Jones Industrial Average and the S&P 500 index were marginally higher, while futures for the technology focused NASDAQ composite were flat ahead of today’s flurry of economic data including Q4 US GDP data, the Chicago PMI (Purchasing Managers Index) and New York ISM (Institute of Supply Management) updates as well as the University of Michigan consumer sentiment index.
Commodities
Oil prices inched lower in the afternoon after making gains earlier today as the US dollar weakened against the euro ahead of today’s US economic data.
A weaker US dollar makes dollar denominated commodities such as crude cheaper for holders of other currencies, driving up the demand.
This week’s inventories report from the Energy Information Administration (EIA) had little impact on the crude prices, which held steady despite an unexpected increase of 3 million barrels in crude stockpiles last week, signalling weaker demand. At the same time, gasoline and distillate stocks including heating oil declined by 900,000 barrels and 600,000 barrels respectively.
Earlier in the week, data from API (American petroleum Institute) revealed that stockpiles fell by 3.1 million barrels last week instead of an expected increase. Gasoline stocks added 1.7 million barrels, while distillate stocks including heating oil were down by 834,000 barrels, which was a lesser decline than projected.
April Brent Crude slid to US$76.21/barrel on the ICE Exchange, while US light, sweet crude inched lower to US$78.14 on the New York Mercantile Exchange today.
Blue chip oil and gas producers were in buying mode today. Tullow Oil (LSE: TLW) and Cairn Energy (LSE: CNE) advanced 1.3%, while BG Group (LSE: BG) added 1%. BP (LSE: BP) rose 1.1%, while fellow supermajor Shell (SLE: RDSB) added less than 1%.
Oil and gas engineering firms Amec (LSE: AMEC) and Petrofac (LSE: PFC) were up 1% and 2% respectively.
Most midcaps followed the trend. Melrose Resources (LSE: MRS) climbed 5% to take the lead. JKX Oil & Gas (LSE: JKX) rose 2%, Dana Petroleum (LSE: DNX) tacked on 1.7% and Premier Oil (LSE: PMO) climbed 1.1%. Soco International (LSE: SIA) and Salamander Energy (LSE: SMDR) were flat, while Heritage Oil (SLE: HOIL) posted a small decline.
Dragon Oil (LSE: DGO) was at the bottom of the pile with a 2.4% loss.
Services companies Wood Group (LSE: WG) and Wellsteam Holdings (LSE: WSM) did well, climbing 1.8% and 1.6% respectively.
Junior stocks didn’t show much movement today. North America focused oil & gas junior Pantheon Resources (AIM: PANR) moved with the sector, adding 4%.
Gold reaches $1,100 on rumored IMF gold sale to China
Gold retreated below US$1,110/oz after rising to US$1,114/oz earlier today on reports that China is set to buy the gold that IMF (International Monetary Fund) is currently shopping. Last week, IMF announced the sale of 191.3 tonnes of gold out of the total 403.3 tonnes earmarked for sale. IMF sold the first 212 tonnes to India, Sri Lanka and Mauritius last year.
The yellow metal got further support from a weaker US dollar, which declined ahead of today’s flurry of US economic data.
Today’s recovery in global stock markets following yesterday’s sharp falls also bolstered gold, which is seen as a riskier investment alternative to the US dollar.
Gold last traded at US$1,109/oz, while fellow precious metals headed in a different direction with silver and platinum sliding to US$16.10/oz and US$1,527/oz respectively.
All major miners were on the rise today. Platinum producer Lonmin (LSE: LMI) and silver and gold miner Fresnillo (LSE: FRES) led the pack with gains of 1.8%, while fellow blue chip Randgold Resources (LSE: RRS) advanced 1.6%.
Specialty chemicals firm Johnson Matthey (LSE: JMAT) rose marginally.
Midcaps also were in demand as gold miner Petropavlovsk (LSE: POG) added 2.8% and silver producer Hochschild Mining (LSE: HOC) climbed 1.6%. Aquarius Platinum (LSE: AQP) rose marginally.
London listed Australian gold producer Leyshon Resources (AIM: LRL) led the juniors with a gain of 8%, while Africa focused gold miner Pan African Resources (AIM: PAF) added 4.5%.
Africa operating gold miner GMA Resources (AIM: GMA) declined 4%.
Miners gain as base metals advance
Base metals were higher today. Copper and nickel reached US$3.21/lb and US$9.21/lb respectively, while zinc improved to US$0.97/lb.
Miners were higher as metal prices rose. Vedanta Resources (LSE: VED) was the top performer with a 2.7% gain. Anglo American (LSE: AAL) and Rio Tinto (LSE: RIO) followed, climbing 2.3%, while Antofagasta (LSE: ANTO) and Eurasian Natural Resources (LSE: ENRC) added 2.2% and 2% respectively.
Kazakhmys (LSE: KAZ) tacked on 1.7% and BHP Billiton (LSE: BLT) and Xstrata (LSE: XTA) climbed 1.4%.
London's only listed pure iron ore producer and FTSE 250 constituent, Ferrexpo (LSE: FXPO) outperformed the sector with a 3.6% advance.
South American focused junior miner Herencia Resources (AIM: HER) led the juniors with a 9% climb after commencing a diamond drill programme at its Paguanta project in Chile. Iron ore focused investor Red Rock Resources (AIM: RRR) rose 5.5%.
Banks, insurance, private equity
Banking stocks were mixed today. Part-nationalised banks Lloyds (LSE: LLOY) and Royal Bank of Scotland (LSE: RBS) were in decline, shedding 5.7% and 2.3% respectively. Barclays (LSE: BARC) was flat, while HSBC (LSE: HSBA) posted a small gain and Standard Chartered (LSE: STAN) advanced 1.3%.
Insurers were in buying mode today. Aviva (LSE: AV) was in the lead with a 3.3% climb. Old Mutual (SLE: OML) was close, gaining 3%. Standard Life (LSE: SL) and Legal & general (LSE: LGEN) tacked on about 2%, Prudential (LSE: PRU) and Admiral Group (LSE: ADM) were up 1.5% and 1.4% respectively, while RSA Insurance Group (SLE: RSA) was flat.
Private equity group 3i (LSE: III) added 1.4%.
Small Cap Movers
Other notable movers among the small caps included African focussed soft commodity specialist, Agriterra Limited (AIM: AGTA), which rallied 12%.
Large and Mid Cap News
Turbines and aircraft engines maker Rolls-Royce PLC (LSE: RR) announced a recommended 67 pence per share cash offer for the remaining holding in ODIM ASA (OSX: ODIM), valuing the Norwegian marine technology company at approximately £154 million.
Web-based UK property search-portal Rightmove (LSE: RMV) reported underlying operating profit growth  of 2% from £41.0m to £41.9min in the full year ended 31 December 2009, and noted that the number of advertisers using the portal increased by 6% to 17,664.
Small Cap News
Equatorial Palm Oil (AIM: PAL) joined London’s AIM market this morning following a £6.5m IPO. The newly listed, £14.3m market-cap company is developing sustainable palm oil plantations and a crude palm oil (CPO) processing operation in Liberia. According to EPO, palm oil is the most important and widely produced edible oil in the world, and demand is projected to grow at 5-6% per annum over the next five years.
Minera IRL Limited (AIM: MIRL) has signed an option to purchase the Quilavira gold exploration project in the Tacna district of southern Peru from Ingerieria y Tecnologia Minero-Metalurgica SA (ITMM). The tenements were previously explored by Newcrest Mining (ASX: NCM). The proposed US$50,000 deal is subject to approvals in Peru.
Perth-based exploration and development group Berkeley Resources (AIM, ASX: BKY) are pleased to advise completion of the first stage Mineral Resource Estimates, which has resulted in the doubling of its resource to 52 Mlbs U308 for the Salamanca Uranium Project in Spain.
Pan Andean Resources (AIM: PRE) provided investors with an update regarding the demerger of its North American and Bolivian operations, and the Petrominerales (TSX: PMG) acquisition of its Colombian and Peruvian assets. Pan Andean sent the relevant proposal documents to investors today, ahead of a shareholder vote at a general meeting which is scheduled for the 22 March 2010.

ViaLogy (LSE: VIY) has raised approximately £2.88m through the placing of 59.1m new shares with existing shareholders at a price of 4.875p per share. The proceeds will be used in to further expand ViaLogy's Energy business, which uses the proprietary QuantumRD seismic interpretation technology to location and analyse oil well sites.
Caledon Resources (AIM: CDN) said coal demand has picked up in the final quarter of 2009 and recovery in prices continued in Q1 2010 after the demand fell earlier in the year amid the economic downturn, impacting coal prices and driving down the company’s revenues.
FinnCap said that African Diamonds’ AK6 project in Botswana will be the most lucrative new open pit hard rock diamond project to enter production in the next 10 years. The stockbroker initiated its coverage with a ‘buy’ recommendation, targeting 108p per share. The analyst believes that the recently upgraded top-end diamond valuation, of US$200/carat, could prove to be conservative.
NF Energy Saving Corporation (OTCBB: NFEC) anticipates its 2009 full year revenues to rise 28% year-on-year to US$20-21 million, while earnings per share are expected to soar 250% to US$0.35 with more growth eyed in 2010.
SeaEnergy (AIM: SEA) has been named Company of the Year at the Rosenblatt New Energy Awards 2010. The award recognises the company which made the most meaningful progress or made the biggest impact in the renewable energy sector during the year. The company is currently participating in the large government-backed offshore wind-farm development in the North Sea.
WH Ireland issued a report on Goldplat (AIM: GDP), retaining its 'speculative buy' recommendation for the Africa operating gold and platinum miner and calling it the world’s only fully funded independent exploration junior with large feedstock samples that guaranteed revenue for a number of years.
Avocet Mining (AIM: AVM) has completed the first shipment of gold from its Inata mine in Burkina Faso. The company exported 11,000 ounces of gold to Rand Refinery's facility in South Africa, following Inata’s first pour on 20 December 2009. Proceeds of approximately US$12m are expected to be received next week.
Petra Diamonds (AIM: PDL) has sold the 507 carat Cullinan Heritage diamond for US$35.3m, which is the highest recorded sale price for a rough diamond. Hong Kong based jeweller Chow Tai Fook bought the diamond through a tender process in South Africa.
Herencia Resources (AIM: HER) has commenced a 3,500 metre diamond drill programme at its Paguanta zinc-silver-lead-gold project targeting potential high grade extensions to the known mineralisation after the previous drill programme returned high grade assay results in 2008.

Broker Fairfax issued a note on International Ferro Metals (AIM: IFL) today, projecting the surging ferrochrome prices to push the company back into profit and giving it a 'buy' rating. It also increased the price target to 61 pence compared to the previous target of 59 pence and a market value of around 33.75 pence.
In a brief note, Gulfsands Petroleum (AIM:  GPX) informed investors that it would now release its preliminary results for the year to end-December 2009 on Tuesday 30 March 2010, rather than 29 March as previously announced.

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