London markets open on a marginally positive footing in early trade on Wednesday with investor appetite still bolstered by possible monetary stimulus from the Bank of England in a bid to ward off recession. The FTSE 100 index nudges around 20 points higher to 6,717, with midcaps following suit, the FTSE 250 up a slightly more modest 0.2% at 16,940.
In an otherwise relatively quiet corporate news day, calls, broadband and TV supplier TalkTalk (TALK) is among the leading risers as it issues a better-than-expected trading update for the three months to 30 June, and importantly, reaffirms full year guidance. Its stock similarly rallies 4% to 231.7p, although that should be put into the context of a 15% share price decline since late April and a 40%-plus slump over the past year.
There is a good chance the earnings downgrade cycle may be over for the resources sector with commodity prices regaining strength and demand fundamentals looking slightly better. As such, BHP Billiton (BLT) shareholders may be a bit miffed it has disappointed with quarterly iron ore production below forecasts and reduced guidance for petroleum output. Shares fall 2.5% to 924.75p.
A sparkling half-year trading update from semiconductor wafer technology minnow IQE (IQE:AIM) sends the stock shooting more than 11% higher to 19.75p. The company hints at a big 15% jump in revenues year-on-year and stern action on deleveraging its balance sheet. The actual results will be published on 13 September.
Restore (RST:AIM) gets its teeth into the £83.1 million acquisition of shredding and document storage business PHS Data Solutions. Analysts believe it will give a major boost to Restore’s profits and investors certainly like the news with the shares up more than 5% in early trading. It has raised £35 million through a share placing to help fund the deal.
Cash call moves in the resources space spark several share price slumps. Xtract Resources (XTR:AIM) is looking for £1 million although it also says its proposed disposal of its Manica project in Mozambique was progressing well. But the stock slumps nearly 36% to 0.06p.
Similarly, Kennedy Ventures (KENV:AIM) goes cap in hand to investors for £2 million of fresh funding at 3p per share. That respresents a whopping 37% discount to yesterday's 4.76p close, so today's close on 30% share price dive to 3.38p will surprise few.
The deal-hungry car retailer says profitability in the four months to June was ahead of the prior year, driven by strong used car sales and aftersales and with like-for-like sales up 8.4%. On track to deliver against full-year estimates, Vertu says the bulk of the £35 million acquisitions war chest raised in March has been deployed in earnings-enhancing deals.
Takeaway ordering system Just Eat (JE.) takes on 0.9p at 471.5p as it completes the sale of hellofood Brazil to its iFood joint venture in Brazil; Just Eat has also sold a 49% stake in its Mexico business to the joint venture in deals it says will help build scale in exciting Latin American markets.