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Market movers: Ophir, Smiths Group, HSBC, Antofagasta, Rolls Royce, Persimmon

Last updated: 19:29 19 Mar 2014 AEDT, First published: 20:29 19 Mar 2014 AEDT

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The FTSE 100 was flat ahead of a pre-election budget in the UK and a policy announcement by the US Federal Reserve later today. 

UK Chancellor George Osborne will unveil the government’s fiscal plans for 2014-15 in a pre-election budget this afternoon with some of the spending and tax plans already announced, while the Bank of England will release the minutes of its last policy meeting.

Across the pond, the US central bank is expected to announce it will reduce its bond-buying stimulus by $10bn to $55bn and provide guidance on when it may lift interest rates. 

The UK’s blue chip index slipped 0.2% with Smiths Group (LON:SMIN) the biggest faller. The British engineering group posted a 3% decline in first-half profit and warned that adverse foreign exchange movements will increase sharply in the second half and have a 4-5% impact on its full-year earnings.

HSBC was also lower after Credit Suisse cut its recommendation to underperform from outperform and slashed its price target on the bank to 580p from 780p. It said HSBC’s global competitive position was being eroded by UK regulation and noted concerns about the Asian market. “We have been too positive on earnings and capital generation and are now more concerned (given macro data) that the operating environment in Asia is weakening, leading to further earnings risk,” Credit Suisse said.

A downgrade from “hold” to “sell” by Deutsche Bank also pushed copper producer Antofagasta (LON:ANTO) lower. Rival miners Anglo American (LON:AAL) and Glencore Xstrata (LON:GLEN) were  also down.

Partially offsetting these fallers were Rolls Royce (LON:RRS) and Persimmon (LON:PSN) after being upgraded to “buy” at UBS.

Elsewhere, Ophir Energy’s (LON:OPHR) disappointing update on its first Gabon pre-salt well pushed the shares down 20%. The Padouck Deep-1 well, offshore Gabon, did not encounter significant hydrocarbons in the targeted reservoirs, the FTSE-250 company said, although it added that the failure appeared to be prospect-specific and did not dampen its enthusiasm for the broader pre-salt play. 

Silence Therapeutics (LON:SLN) posted a pre-tax loss for 2013, although the loss narrowed from the previous year, pulling the shares down 2%. The company also announced the potential for a future substantive fundraising and said it was actively considering options to strengthen its balance sheet.

Shares in Metminco (LON:MNC, ASX:MNC)  surged 11% after it announced it planned to fast-track the feasibility study  for its Mollacas copper project after financial modelling of the site demonstrated its "robust nature".

Research group ValiRx (LON:VAL) also bucked the trend. Its shares rose 4% after it confirmed it had a strong financial base to complete first-in-human trials of its lead drug candidate, VAL210, for prostate cancer.

Polo Resources (LON:POL) was up 1.3% after it acquired 12.7% of Tunisia-focused phosphate group Celamin (ASX:CNL) for A$1.2mln. Celamin is advancing the Chaketma phosphate project towards a bankable feasibility study.  

Shares in Beowulf Mining (LON:BEM) climbed after it said it was encouraged by the grade and recovery levels returned on a test sample of material from its Kallak North iron ore deposit in northern Sweden. The pilot test was undertaken to demonstrate that marketable products can be produced at sufficient recovery levels. Beowulf also said drilling campaigns on Kallak North and the Kallak South deposits have now resumed.

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