Political uncertainty in Egypt and the prospect of more unrest to come this week has unsettled world markets but there were signs of steadying nerves in London today. Oil was the main focus of attention, with the Egyptian situation blamed for forcing prices close to $100 a barrel overnight. Analysts warned that the price could surge further if the geopolitical instability that has already toppled the Tunisian government this year, swept into other Middle Eastern states, particularly the big oil producers. At lunch, the FTSE 100 was trading up 52.52 points at 5,915.46.
Reporting its fourth quarter and full year figures, oil giant BP (LON: BP.) credited recent high oil prices for a stronger performance in the final three months of last year although analysts said the $4.4bn (£2.7bn) profit still fell short of expectations. Overall, the group delivered a $4.9bn (£3.1bn) loss last year against a profit in 2009 of $13.9bn (£8.7bn). It said it intended to sell two of its refineries in the US – Texas City and Carson – and re-focus on oil production. The BP share price fell by 1.3% to 478.4p during the morning.
Elsewhere, the Arm Holdings share price enjoyed a 3% gain to 531.1p after the chipmaker reported a 73% surge in pre-tax profits to £167.4m last year on the back of a 33% rise in sales to £406.6m. Sales of electronic devices such as Apple’s iPad, which uses ARM’s chips, continued to bolster the company’s figures. Nevertheless, the group said it anticipated that the semiconductor industry would return to more typical growth levels in 2011 and that it was keen to broaden its exposure to new markets.
The third blue chip company publishing full year results today was Autonomy (LON: AU.), which said that revenues had grown by 18% to $870m (£540m) last year with pre-tax profits up to $282m (£175m) from $266m (£165m) previously. The Autonomy share price rose by 6.4% to 1593p on the performance. Group CEO, Dr Mike Lynch, said that 2010 had been “a year of transition” and that the company had continued to gain ground in the fields of Meaning Based Computing and Cloud technology.
Elsewhere in the FTSE 100, the Serco share price enjoyed a modest gain on reports that the support services group had been selected as preferred bidder on a 10-year, £140m prison management contract in New Zealand. The Resolution share price gained 1.2% to 264.7p after the life insurer said its Friends Provident arm had completed the acquisition of Bupa Health Assurance.
In commodities and energy, the Xstrata share price gained 2% to 1412.5p on reports of record production of coking coal, semi-soft coking coal, mined nickel and refined nickel in the 12 months to last December. There were also year-on-year increases in mined copper, lead in concentrate and ferrochrome production. Finally, the Scottish & Southern Energy share price edged higher to 1286p on news that the utility group was still on track to deliver its main financial and operational goals in the second half of the year, which ends in March.
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