Miners are lower this morning after disappointing results last night from Alcoa, the world's leading producer of aluminium which got the US reporting season off to an uninspiring start.
So after the FTSE 100 lost most of its early gains to finish - just about - in positive territory, the leading index is under pressure so far today. It has dipped 20.02 points to 5518.05, with silver miner Fresnillo leading the fallers, down 25.5p to 826.5p. Vedanta Resources is 56p lower at £27.78, while Eurasian Natural Resources Corporation is off 19p at 991p. Manoj Ladwa, senior trader at ETX Capital, said:
Having run out of steam yesterday, the FTSE is showing further signs of tiredness this morning. While defensive stocks such as the food retailers trade up strongly, heavyweights such as mining and oil and gas are firmly in negative territory. Earning season kicked off yesterday in the US after Alcoa reported fourth quarter numbers lower than analysts estimated.
Following its bumper Christmas performance Tesco is leading the risers, up 9.7p at 427.55p while Morrisons - which is due to update the market next week - is up 2.6p at 292.8p.
Back among the fallers, interdealer broker Icap is down another 11p at 439p. Yesterday Michael Spencer, the company's founder and chief executive who is also chairman of the Conservative party, raised £45.4m by cutting his and his family's stake in the business. The news seems to have encouraged other investors to cash in some of their profits.
But analysts at Daniel Stewart retained their hold rating on Icap:
The desire to deleverage [Spencer's private company] IPGL was given as the reason for the placing. The issues that IPGL has faced have been well publicised [including losses on some of its investments] and we would not anticipate the share sale causing any medium-term damage to the share price of ICAP. Indeed, Michael, via his personal and other interests is still the major shareholder with a 17.4% holding, almost 114m shares. We retain our 430p target price, implying 5% downside and therefore a hold recommendation. When we see further evidence of a noticeable improvement in underlying trading volumes we will likely turn more positive.
