FTSE 100 movers: Burberry brought back to earth, Pru allays Asia worries

The FTSE 100 fell back into the red towards the end of Wednesday's session, having approached 6,200 in the early afternoon.

Having being lifted by romantic rumours of a 'mystery buyer' Burberry shares tripped back down to earth when rather than a single, handsome fashion-fancier, the unknown 5% stake was in fact the result of a series of trading positions taken on by clients of HSBC. Shares in the trenchcoats and scarves maker skidded down more than 7% by Wednesday afternoon.

Several reports, citing sources familiar with the matter, dismissed the existence of a mystery stake-builder. The company had been reported on Tuesday to have gone as far as asking its advisers at Robey Warshaw to help it prepare against a possible bid.

The big miners were well represented among the main blue chip fallers, with prices in most metals back on the decline, including iron ore after its bounce earlier in the week.

Commentators suggested that traders had moved ahead of the curve and, with the Chinese economy remaining lacklustre, reality dawned once again to bring prices down.

Anglo American shares were worst hit, falling 4.46% as Nomura reiterated its 'reduce' rating in expectation the company will reverse its recent outperformance. Antofagasta was down 3.08%, BHP Billiton 2.81% lower, Fresnillo falling 2.34% and Rio Tinto shedding 2.30%. Glencore was marginally in positive territory, with some investors maybe feeling it was oversold the previous day when fatalities at one of its mines exacerbated wider sector falls.

Aberdeen Asset Management and Standard Chartered were hit by a note from Morgan Stanley, which had them among the least preferred stocks in the European banks and diversified financials sector. Investec also downgraded StanChart to 'sell' from 'hold' after a 23% two-week rally in the shares.

Risers were led by Prudential which beat expectations for operating profits growth, added a special dividend and provided reassuring words from chief executive Mike Wells on the outlook in the UK, US.

Operating profits rose 22% to £4.0bn, partly helped by a one-off £339m benefit from slimming down the UK life business to reflect the new Solvency II regulations. Directors sealed the deal with a 10p special dividend on top of a full-year dividend that was only hiked 5% to 38.78p per share - slightly below the consensus.

"The fundamentals of the group remain compelling, our opportunities are intact and we are in an enviable position to benefit from the attractive structural and demographic opportunities in Asia, the US and the UK," said Wells.

Societe Generale said the headline numbers looked "strong", with operating profit coming in 10% ahead of consensus. Even with the one-off management action stripped away forecasts still beat estimates by 1%.

SSE was rising strongly on the back of a JPMorgan Cazenove upgrade reflecting the turning of the industry cycle.

The bank said UK merchant utilities have been buffeted in recent years by a number of headwinds, with energy consumption down, structural oversupply driving a collapse in commodity-based earnings, and interventionist regulation and policy settings muddying the waters.

“The CMA’s energy markets review will imminently conclude, reducing regulatory risk; generation markets look set to tighten and a proposal has been tabled to repair the capacity market. Underlying structural risks undoubtedly remain, but we see constructive evidence of earnings stabilisation.”

FTSE 100 - Risers

Prudential (PRU) 1,360.50p 2.56%
SSE (SSE) 1,468.00p 2.30%
Taylor Wimpey (TW.) 176.90p 2.14%
Berkeley Group Holdings (The) (BKG) 2,999.00p 2.08%
Reckitt Benckiser Group (RB.) 6,586.00p 1.79%
Persimmon (PSN) 2,000.00p 1.63%
Capita (CPI) 1,045.00p 1.55%
International Consolidated Airlines Group SA (CDI) (IAG) 538.00p 1.13%
DCC (DCC) 5,670.00p 1.07%
Relx plc (REL) 1,241.00p 1.06%

FTSE 100 - Fallers

Burberry Group (BRBY) 1,356.00p -7.25%
Anglo American (AAL) 507.20p -4.46%
Standard Chartered (STAN) 464.40p -3.35%
Aberdeen Asset Management (ADN) 266.50p -3.34%
Antofagasta (ANTO) 520.00p -3.08%
BHP Billiton (BLT) 798.30p -2.81%
Barclays (BARC) 167.60p -2.56%
Ashtead Group (AHT) 840.50p -2.44%
Fresnillo (FRES) 895.50p -2.34%
Rio Tinto (RIO) 1,979.50p -2.30%