FTSE flat early as commodities offset weak pharmas
The top share index was flat early on Wednesday as firmer metal and crude oil prices boosted commodity stocks, offsetting weakness in drugmakers.
FTSE gains as metals spur minersBy 8:53 a.m., the FTSE 100 .FTSE was up 0.2 points at 5,470.9, after losing 0.6 percent on Tuesday.
The benchmark is down 15 percent for the year on fears of a recession fears, concerns over rising commodity prices and the impact of a global credit crunch on financial firms.
Energy stocks were in demand as crude prices traded above $116 a barrel and after oil explorer Tullow Oil said net profit from continued activities more than doubled in the first half of the year to 126 million pounds helped by higher oil prices. Tullow Oil added nearly 2 percent.
Oil and gas services firm Petrofac also reported better-than-expected first-half results as net profit jumped 57 percent from a year ago, helped by strong demand. Petrofac shares were 1.4 percent higher.
BP, Royal Dutch Shell, gas producer BG Group and Cairn Energy put on 0.2 to 0.9 percent.
Firmer copper prices lifted miners, with Rio Tinto, BHP Billiton, Anglo American, Vedanta Resources and Ferrexpo gaining 0.9 to 1.5 percent.
Antofagasta posted an 8.8 percent rise in first-half earnings per share as higher copper output and prices outweighed rising costs. Its stock was up 0.9 percent.
"We have some reasonably big companies reporting today, the likes of Antofagasta and Tullow Oil, but in some way no great surprises. The stocks are reacting as you might expect," said Tim Hughes, head of sales trading.
Hughes said trading volume was light as many traders and fund managers were away on holiday, leaving the market with little direction.
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