Newspaper article The Evening Standard (London, England)

The Obama Bounce Kicks in at Last for London Shares

Newspaper article The Evening Standard (London, England)

The Obama Bounce Kicks in at Last for London Shares

Article excerpt


SHARES bounced back on the London stock market today, providing investors with something to cheer about for a change.

Buoyed by the Obama Bounce on Wall Street overnight and by gains in Asia this morning, the FTSE 100 index sported a rise of 64.58 points to 4124.46.

Even the banks joined in the fun, following losses of the past few days that were so severe they prompted the Treasury Select Committee to call for a reintroduction of the ban on shortselling yesterday.

Royal Bank of Scotland rallied 1.5p to 14p, Lloyds Banking 4.1p to 49.2p and Barclays 4.7p to 70.8p. All three have been targeted this week by stockmarket bears looking to capitalise on growing fears of cash handouts from the Government, leading to full nationalisation and further write-offs.

The Christmas and New Year trading update from Wm Morrison got the thumbs-up from the City, but cautious comments about the supermarkets chain's outlook left the shares down 11/2p at 2623/4p. The like-for-like sales increase of 8.2%, excluding petrol sales, was towards the top end of the range.

The group says it has managed to attract new customers from its rivals.

It now seems evident that all the supermarkets enjoyed a good run-up to the festive season. Morgan Stanley rates the sector as a safe haven in these troubled times and has raised its target levels for the big three. Morrisons is seen as equalweight with its target raised from 265p to 285p. Sainsbury's has been raised from 290p to 320p and Tesco from 280p to 310p.

Tullow Oil continues to draw strength from its operations in Uganda, the shares adding 251/2p to 651p. The explorer and its operating partner Heritage

Oil have struck it rich at the Giraffe-1 well in Uganda, which could boast oil reserves of more than 400 million barrels. Cazenove responded to the news by raising its rating from in-line to outperform. Rival Bernstein also rates the shares outperform while Deutsche Bank has a buy rating and 925p target. Tullow last week raised [pounds sterling]402 million through a placing of 66.9 million shares at 600p to help finance the development of the new field. …

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