Cairn Energy, Vedanta Resources up on deal

| August 16, 2010 | 0 Comments
Cairn Energy, Vedanta Resources up on deal

European equities markets were mixed, with some seeing little movement at all from Friday’s close.

The FTSE 100 added just 0.01 percent to 5,276.1 in London, while the FTSE 250 dropped 0.08 percent to 9,774.23.

Cairn Energy (LSE: CNE) led gains on the 100, adding 5.32 percent after it reached a deal for miner Vedanta Resources (LSE: VED) to purchase up to 60 percent of Cairn’s oil operations in India for between $8.5 billion and $9.6 billion.

Vedanta was right behind Cairn on the list of gainers on the 100, adding 4.87 percent to lead a mostly higher mining sector, where only iron-ore miner Ferrexpo (LSE: FXPO) and Gem Diamonds (LSE: GEMD) were lower, dropping 0.62 percent and 0.71 percent respectively.

The best performance of the session in London came from oil well construction specialist Hunting (LSE: HTG), which added 7.72 percent on the 250 to lead gains in the energy sector.

BP (LSE: BP), meanwhile, was down 1.6 percent on a delay in completing its relief well in the Gulf of Mexico as a risk of new leaks arose, while the worst performer in the sector came from oil rig builder and refurbisher Lamprell (LSE: LAM), which dropped 3.11 percent.

The biggest decline in London came from investment managers Gartmore Group (LSE: GRT) with a decline of 4.72 percent.

London banks were mostly lower, led down by Royal Bank of Scotland (LSE: RBS), which fell 2.47 percent, while only Barclays Bank (LSE: BARC) saw gains, adding 0.41 percent.

Banks were also lower in Ireland, where Bank of Ireland (ISEQ: BKIR; LSE: BKIR) fell 3 percent and Allied Irish Banks (ISEQ: ALBK; LSE ALBK) dropped 4.3 percent.

The FTSE Eurofirst 300 was down 0.12 percent to 1,044.36 while the IBEX fell 0.17 percent to 10,258.3 and the CAC-40 dropped 0.37 percent to 3,597.6 but the Dax managed to added 0.16 point to 6,110.57.

Most markets in the Asia-Pacific region were lower on the session, but the Shanghai Composite added 2.11 percent to 2,661.71 on the news that China surpassed Japan as the world’s second largest economy last quarter.

In addition, the Hang Seng was up 0.19 percent to 21,112.12 in Hong Kong and Taiwan’s Taiex gained 0.63 percent to 7,941.22.

Declines in other markets came after it was reported that Japan’s gross domestic product only added 0.4 percent at an annualized rate in the April through June quarter, against an expected expansion of around 2.3 percent.

The Nikkei 225 was down 0.61 percent to 9,196.67 in Tokyo, while the Topix index dropped 0.31 percent to 828.63 and the Mothers market was 1.02 percent lower to 370.04.

Computer services group CSK Holdings Corp (TYO: 9737) fell 6.9 percent, the most on the Nikkei, after Daiwa Securities cut its recommendation from “buy” to “neutral”.

Shares related to the oil and mining sectors were lower on recent declines in oil and metals prices, with trader Mitsubishi Corp (TYO: 8058) down 1.1 percent while JX Holdings (TYO: 5020) fell 3.2 percent and Inpex (TYO: 1605) and Japan Petroleum Exploration Co (TYO: 1662) were each 3.5 percent lower.

Exporters were down as well, including a drop of 0.7 percent for camera and copier maker Canon (TYO: 7751), while carmaker Honda Motor (TYO: 7267) fell 0.9 percent and industrial robot maker Fanuc (TYO: 6954) was down 1.9 percent.

Elsewhere in the region, South Korea’s Kospi was down 0.17 percent to 1,743.31, while the Straits Times Index was 0.22 percent lower to 2,933.51 in Singapore.

The Sydney Ordinaries dropped 0.35 percent to 4,465.4 in Australia, while the S&P/ASX200 was down 0.47 percent to 4,438.5.

India’s Sensex was 0.64 percent lower to 2,933.51.

New York markets were a bit higher as investors looked for bargains, with the Dow Jones Industrial Average up 0.28 percent to 10,331.53 in midday trade, while at the same time the S&P 500 had added 0.29 percent to 1,082.33 and the Nasdaq Composite was 0.92 percent higher to 2,193.38.

At around 12:30 p.m. local time in New York, crude oil prices were slightly lower while metals prices rose, with gold trading near $1,225 per troy ounce.

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