It is unknown whether the bosses of Intu Properties are a superstitious bunch, but they may be regarding leap day yesterday as particularly lucky after the shopping centre group came out of Hammerson’s shadow.
The stock was one of leading performers on the FTSE 100, finishing nearly 12p higher at 300¼p. Long considered by traders as somewhat inferior to Hammerson, its rival, it appears that a number of factors are working in Intu’s favour.
Traders are beginning to see it as less of a “vanilla” stock, partly because of Hammerson itself, which has troubled some analysts with its recent entry into Ireland and its acquisition of the Grand Central shopping centre above New Street station in Birmingham, which some considered too expensive.
Meanwhile, Intu has good shopping centres of its own and has been gradually freshening up some older stores. It is considered to be “underowned” by shareholders and analysts are even wondering whether it is ripe for an M&A bid.
“There has been a bit of a reappraisal of Intu. It is looking more interesting at this stage of the cycle than Hammerson,” Mike Prew, a Jefferies analyst, said.
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On the wider market, the FTSE 100 edged up 1.08 points to 6,097.09 after a surprise move by the Chinese central bank, which cut the amount of cash that lenders must hold in their reserves. Miners, always sensitive to developments in China, took this well.
Glencore rose in advance of its results today, which are expected to show it swinging to a loss of $400 million last year. The shares closed 5p higher at 133¼p. Anglo American was the best blue-chip performer, ending the day up 29¾p at 480¼p. Rio Tinto rose 43½p to £19.04.
Staying with the miners, it was perhaps inevitable that the juniors would turn to dealmaking when the sector is having such a tough time of it. Amara Mining gained 1¾p to 12p after agreeing to an all-share takeover by Perseus Mining, of Australia, another west African gold explorer. This values Amara at £68 million.
Closer to home, it was a horrible day for Ocado, which finished down nearly 22p, or about 8 per cent, at 260p, after Amazon delivered a crushing blow. The American online retailer announced a tie-up with Wm Morrison, which until now has used Ocado exclusively to run its online deliveries. The Morrisons/Ocado deal will continue.
Tesco also dropped amid fears of extra competition from Amazon, not to mention rumours of the grocer putting in a rival bid for Home Retail Group and reports of Tesco planning to cut 39,000 jobs over three years. It fell 3¾p to 180½p.
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Among the big Footsie fallers, London Stock Exchange led the way, shedding 139p to £26.78.
HSBC was down 7¾p at 459¾p and Standard Chartered 15p was cheaper at 415p after a bearish note from Bernstein, which downgraded HSBC to “underperform” and slashed its target price for Standard Chartered from £10.00 to 600p.
On the mid-cap FTSE 250, Hiscox took a nasty spill after its full-year results revealed that the insurer had suffered a 6.5 per cent drop in pre-tax profits to £261.1 million. Like others, the company was taken by surprise at the severity of this winter’s storms, which are expected to have cost it £10 million. The shares fell 88p, or more than 8 per cent, to 973p.
Lenigas is gushing once again
The Australian entrepreneur who helped to found FastJet with Sir Stelios Haji-Ioannou and who recently attracted attention for proclaiming there was a huge oilfield beneath Gatwick has turned his attention to Cuba.
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David Lenigas is chairman of Leni Gas Cuba, which has invested £73,000 in MEO Australia, making it the Cuba-focused oil operator’s single largest shareholder, with a 15.8 per cent stake.
The sale will help MEO to raise more than $1 million to help with the financing of its fledgeling exploration programme near the Cuban coast. MEO claims that the potential for oil and gas development in Cuba is “exceptional”.
Last year, the US Geological Survey estimated that there were about 4.6 billion barrels of crude oil and 9.8 trillion cubic feet of natural gas in the form of undiscovered reserves in Cuba, three quarters of which are believed to be located within 50 miles from the shore.
Mr Lenigas said: “This is a significant strategic investment in the Cuban oil and gas sector for the Company, as MEO Australia are one of the few foreign oil companies that have pre-qualified to operate oil joint ventures in Cuba.”
Wall Street report
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It’s leap year, but the romantics were in short supply on Wall Street. No proposals or bethrothals here, just a gloomy mid-afternoon sell-off that took indices into the red. The Dow Jones industrial average retreated 123.47 points to 16,516.50