LONDON (Alliance News) - The following stocks are the leading risers and fallers within the main London indices midday Monday.
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FTSE 100 - WINNERS
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Reckitt Benckiser, up 2.3%. Shares in the firm have been on a down trend over the past two weeks, but ahead of the group's first quarter results on Wednesday, Bloomberg has reported that the consumer goods group is considered the frontrunner to buy US pharmaceutical company Merck & Co's over-the-counter health business. "We see strong industry logic for any deal and think that Reckitt Benkiser can unlock value," says Jefferies analyst Martin Deboo.
Imperial Tobacco Group, up 1.8%, British American Tobacco, up 1.8%, Diageo, up 1.8%, and SABMiller, up 0.9%. The traditionally defensive beverage and tobacco companies' shares have jumped as tensions in Ukraine escalate. In the latest developments, Russian supporters occupying state institutions in Ukraine said that they would not heed Ukraine's acting President Oleksandr Turchynov's ultimatum to lay down their weapons and leave the buildings they are occupying. "Nobody is prepared to give up," said Alexei Chmulenko, a spokesman for the protesters in the Luhansk region.
Glencore Xstrata, up 0.7%. The mining company has agreed to sell its interest in the Las Bambas copper project in Peru to a Chinese consortium including MMG, Guoxin International Investment Corp and CITIC Metal Co for USD5.85 billion in cash. The consortium will also reimburse all capital expenditure and other costs incurred in developing the project between January 1 and the closing date of the deal. The deal is part of an agreement to win Chinese regulatory approval for its USD29 billion takeover of Anglo-Swiss miner Xstrata in May last year
Standard Chartered, up 0.6%. Japanese based financial services group Orix Corp is weighing up a bid for Standard Chartered's consumer credit unit in Hong Kong, Bloomberg has reported, citing two people familiar matter. Standard Chartered wants to sell the unit for about USD700 million, almost three times book value, and plans to compile a shortlist of potential bidders this month, the report said.
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FTSE 100 - LOSERS
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Barratt Developments, down 5.2%, and Persimmon, down 4.6%. Housebuilders have been in a down trend recently following a very strong performance in 2013 and the beginning of 2014. Numis analyst Chris Millington believes that the weak performance could be due to recent media coverage of the mortgage market review that is set to take effect at the end of April and result in lenders tightening their mortgage lending criteria.
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FTSE 250 - WINNERS
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Jardine Lloyd Thompson Group, up 0.6%. Numis Securities has upgraded the firm to Add, from Hold, lifting its price target to 1,190.00 pence from 995.00p. Jardine achieved revenue growth of 11% in 2013, and the company's guidance has remained unchanged from previous years, despite recent sterling strength modestly weakening the value of overseas earnings. Numis analyst Nick Johnson also believes that the company's acquisition of Towers Watson at the end of 2013 was a significant step in positioning it as an equal alternative to the dominant big three reinsurance brokers, "providing a strong platform to increase market share from around 7% currently".
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FTSE 250 - LOSERS
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Pace, down 5.4%, and Imagination Technologies, down 5%. Technology stocks are yet again among the biggest fallers in the FTSE 250, amid concerns over the high multiples on which some of them trade.
Taylor Wimpey, down 4.3%, and Bovis Homes Group, down 3.5%, are two further examples of housebuilders under pressure Monday. Goldman Sachs has also cut its price target for Bovis to 1,183.00 pence from 1,187.00p.
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AIM ALL-SHARE - WINNERS
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Galantas Gold Corporation, up 314%. Shares in the gold exploration and development company have jumped after the five for one consolidation of its shares became effective. The company hopes the consolidation will help improve the current trading price for the company's securities.
Microsaic Systems, up 6.4%. The company has signed a pre-contract commercial agreement with a healthcare equipment company to market and sell its 4000 MiD mass spectrometry instrument. Mass spectrometry is an analytical technique used to produce a sample of material. It will now work towards inking a full commercial contract with the unnamed partner by the end of 2014. It expects to sign a contract for the purchase of up to 50 units and consumables of the 4000 MiD in the first year, rising to over 200 units and consumables from the fourth year.
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AIM ALL-SHARE - LOSERS
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Richland Resources, off 43%. The company said its directors will be taking a pay cut and it will be undertaking a strategic review of its operations, as profit at its Merelani tanzanite mine at Block C in Tanzania continues to be hit by illegal mining and smuggling operations. Richland's directors will be taking a 50% reduction in their board fees and executive director salaries and fees as of March 31, until it is able to trade profitably or the subsidiary that operates the mine TanzaniteOne Mining is able to operate profitably. It said it will not be providing any funds to TanzaniteOne Mining until the review has been completed and the security of its employees has been ensured. Moreover, it will not be investing further in Tanzania until the review is finished, and will also be placing its Tsavorite project in Tanzania on hold during the review.
Pentagon Protection, down 31%. The firm, which supplies window films for residential and commercial properties, said it is in talks with several parties about providing short term financing, or other alternatives, to alleviate constraints on its working capital.
Imaginatik, down 13%. The software and consulting services company said that it expects to post a widened loss for the year to end-March, after it increased investment in sales and consultancy personnel and its recognised revenue was broadly flat on the previous year. It said it expects to post a loss of GBP1.5 million, widened from GBP1.2 million a year earlier. Recognised revenue is expected to be about GBP2.9 million, broadly flat on GBP3.0 million, while deferred revenue is expected to have risen to about GBP2.9 million, from GBP2.4 million.
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By James Kemp; jameskemp@alliancenews.com; @jamespkemp
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