Say one thing about the Kazakh miners, they know how to keep you on your toes. With recent speculation concentrating on when and how Kazakhmys would sell its 14.6% stake in rival Eurasian Natural Resources Corporation, Kazakhmys has just issued a statement outlining its proposals.
And far from selling, it has agreed to buy another 7.7% of ENRC from the Kazakh government, taking its shareholding to 22.3% and making it the biggest investor in ENRC. It is issuing 80m new shares to the government to pay for the stake, which means it has paid an average of 623p. In the market ENRC has jumped 64p to £13.89 while Kazakhmys is 22p higher at £16.49.
It seems hard to get a handle as to what exactly is going on here, with the government's involvement and the fact that ENRC recently tried to take over Kazakhmys. The latter now seems in the driving seat, although it says it has no plans to mount a full bid for its rival. Still, as long as the share prices continue to rise on the back of firm commodity prices, investors are not likely to complain too much. But they would do well to keep in mind that politicians and public companies are rarely good bedfellows.
Elsewhere the market has taken its cue from falls in Asia after more comments from US Federal Reserve chairman Ben Bernanke suggesting US rate cuts are over. As for the UK, the talk now is of possible increases rather than reductions, given the growing inflationary pressures. The FTSE 100 is now down 18.2 points at 5859.4.
With a glooming RICS survey on the housing market, builders are being battered again, not helped by a negative note from Goldman Sachs.
The bank has put sell notes on Persimmon, down 21.75p to 407p, Redrow, 13p lower at 184.5p, and Bellway, 3.5p lower at 538p. Persimmon is one of those set to lose its FTSE 100 place today.
Among the banks, HBOS has edged up 3.5p to 310.5p after early slipping closer to its 275p rights price. Still with financials, an upgrade from Credit Suisse has lifted the London Stock Exchange, up 19.5p to 911p. But the same bank sent interdealer broker Icap 23.5p lower to 567p after moving from neutral to underperform.
