Newspaper article The Evening Standard (London, England)

Blue-Chips Await Marching Orders from the Footsie

Newspaper article The Evening Standard (London, England)

Blue-Chips Await Marching Orders from the Footsie

Article excerpt


UP to half a dozen blue-chip companies face losing their place as constituents of the Footsie 100 index when the -regular quarterly review is undertaken later this week.

This is in addition to the high number of changes made in the September review, and that means equity-market strategists will hardly be comparing like-for-like when they make their 2009 year-end forecasts for the Footsie 100 in the next few weeks.

This may account for some of the diverging views we have already seen among brokers forecasts. UBS has predicted a 2009 year-end figure of 5800, which has been contradicted by Morgan Stanley with a worst-case scenario of 2500 at the end of next year.

Critics of the lead indicator already claim it bears little resemblance to the UK economy because of the large number of foreign firms contained within it. They include com-panies such as miner Antofagasta, up 421/2p at 4121/2p, SABMiller, 66p better at 1107p, and Mexico-based precious metals pro-ducer Fresnillo.

Those expected to lose their place this time around following the close of -business on Wednesday include control valves supplier Invensys, 5.5p higher at 139.3p, buses and trains operator Stagecoach, down 7.7p at 111.6p, oil-industry services groups Petrofac, 131/4p better at 3021/2p, and John Wood Group, 7.7p cheaper at 134.3p, and Fresnillo, up 15.3p at 142.4p.

They are likely to be replaced by sup-port services group Serco, 26p better at 4221/4p, miner Randgold, 207p dearer at 2458p, Tate & Lyle, 13/4p firmer at 3931/4p, Argos owner Home Retail Group, 13p better at 224p, and insurer Amlin, 4p lower at 371p.

Shares generally kicked off the week with strong gains. London was given a boost by strong advances in Asia this morning. The FTSE 100 index rose 210.3 points, or 5.4%, to 4259.7 in a market short of stock. Fewer than 1.5 billion shares had changed hands by late after-noon. Wall Street made a flying start this afternoon on the back of President-elect Barack Obamas pledge to inject further funds into the US economy. …

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