UK stocks open on Wednesday showing decent gains for the blue-chips and wider market but midcaps drag on a mixture of corporate news. The FTSE 100rallies around 35 points, or 0.5%, to 6,868 early on, rising for the fifth consecutive session. The index has not closed above this mark since 4 June. But the FTSE 250 fades, drifting a modest 0.1% to 17,978.
Supermarket stocks lead the Footsie charge, supported by selected oil and mining stocks, with grocer Morrisons (MRW) heading the Footsie leader board, up 3% at 185.1p, just ahead of peer Sainsbury’s (SBRY), 2.8% higher at 276.8p. Oil majors Royal Dutch Shell (RDSB) and BG (BG.) also show up positively.
In corporate news, speciality chemicals group Elementis (ELM) takes a drubbing following a disappointing trading update ahead of its full year results, due on 28 July. Shares in the £1.4 billion cap slump more than 12% to 273.9p as the group reports falls in its US markets due to a widespread fall-off in oil drilling projects. Its coatings business is also under pressure in China while personal care took a hit in Latin America.
Bookmaker Ladbrokes (LAD) falls 3.6% to 135p, reversing some of yesterday's 15% share price hike on news of its possible merger with Gala Coral. Analysts are concerned the merger will face competition issues and lead to the forced closure of up to 1,300 shops.
Among the bigger movers, permit progress triggers a 24.2% rise in Eurasia Mining (EUA:AIM) to 1.18p. Russian authorities approved the platinum project application for a mining licence, but it hasn't yet got the final nod from the Prime Minister's office.
Fellow Russian explorer Amur Minerals (AMC:AIM) dives 14% to 26.88p despite obtaining the necessary approval to restart exploration at its Kun-Manie nickel project. The share price fall could be profit taking following a massive spike a few weeks ago upon getting a mining licence.
News of $50 million debt funding with Bank of America is exciting investors in micro-cap oily 88 Energy (88E:AIM) up 18.6% to 0.86p. Although there is simply a letter of intent on the table at present and the facility is conditional on due diligence the new capital, if secured, should support drilling on the Icewine project in Alaska. The company – formerly Tangiers Petroleum - is targeting a first well in the second half.
Exploration minnow Ascent Resources (AST:AIM) leaps more than 22% to 0.19p as its gets the provisional thumbs-up from environmental regulators in Slovenia in relation to the installation of a gas gathering and separation station at the Petisovci field.
Oil explorer Faroe Petroleum (FPM:AIM) is up 4.1% to 86.4p as it commences drilling on the Boomerang prospect and announces an addition to its 2015 drilling programme in the form of a Royal Dutch Shell operated well on the Portrush prospect. Both wells will be drilled in the Norwegian North Sea, Faroe also reveals better than expected production of 11,324 barrels of oil equivalent per day (boepd) and tight control on costs with average operating costs per barrel of oil equivalent of $22.
Ukrproduct (UKR:AIM), a producer and distributor of branded dairy products and beverages in the Ukaine, cheapens 5% to 5.7p as final results reveal wider losses, reflecting devaluation of the Hryvnia and political and economic turmoil in Ukraine.
Visitor attractions operator Paragon Entertainment (PEL:AIM) slides 4% to 1.8p after its pre-tax loss widens to £427,000 in 2014 from £112,000 a year earlier due to 'unexpected project delays'. The company has breached its banking covenant and its chief financial officer Richard Arden has quit.