By Sarah Turner
Losses for BHP Billiton and British Sky Broadcasting kept the
top British share index under pressure on Wednesday, offsetting
gains from technology companies and airlines.
The FTSE 100 index declined 0.1%, or 2.99 points, to 5,780.78.
Other European shares and U.S stock futures were mildly higher.
U.S. technology-sector giant Apple (AAPL) reported stellar
earnings after the close on Tuesday, giving a boost to technology
companies in Europe. ARM Holdings , a supplier of Apple, rose
2.8%.
Meanwhile, software provider Autonomy advanced 1.1% after
reporting that its first-quarter net income rose to $49.7 million
from $34.5 million a year ago, as revenue climbed 50% to $194.2
million.
The firm said that a stronger pipeline and improved closure
rates means that it's growing more confident about a possible
recovery.
Those comments chimed with remarks from the Bank of England
Wednesday. The central bank said it was more confident about the
economy when it made a 9-0 decision to hold interest rates at 0.5%
and maintain its 200 billion pound asset-purchase plan. Sterling
rose 0.2% to $1.5408 after the minutes and data that showed jobless
claims fell 32,900 in March.
Airlines were also advancing, with British Airways shares up
1.2%, after the British Civil Aviation Authority reopened British
airspace after days of cancellations caused by a cloud of volcanic
ash over the country.
Still, BHP Billiton (BHP) shares were down 1.2%. The mining
giant said it has uncovered possible violations of anti-corruption
laws by its employees, following a request for information from the
U.S. Securities and Exchange Commission.
BHP also posted an 11% increase in third-quarter iron-ore
production on year to 31.16 million metric tons, a 16% increase in
petroleum output to 36.84 million barrels of oil equivalent and a
19% drop in copper output to 229,100 tons.
U.K. broadcaster British Sky Broadcasting lost 1.1% after it was
downgraded to hold from buy at Royal Bank of Scotland, which said
IPTV (Internet-enabled TV) is a "growing threat on the horizon. We
believe Sky can continue to grow, but the pace is likely to slow,
and the shares could struggle to outperform."
The RBS analysts also see supermarket group Tesco entering the
pay-TV market, providing new competition for British Sky
Broadcasting which is 39% owned by News Corp, the parent of
MarketWatch.
Tesco , up 1.2%, was upgraded to hold from sell on Wednesday at
Societe Generale, which said management has been reassuring on the
outlook for the group.
In earnings released the prior day, Chief Executive Terry Leahy
told analysts that he doesn't see food inflation falling further,
the U.K. economic recovery is underway, he sees encouraging trends
in non-foods, and international sales are looking up, the broker
said.
Outside the top index, bookmaker Ladbrokes climbed 3.1%.
It expects to receive 80 million pounds ($123 million) from the
U.K. tax authorities after reaching a settlement covering
substantially all the items outstanding in the tax years through to
December 2007.
However, Game Group pretax profit dropped 28% to 84.2 million
pounds as sales declined 10% to 1.8 billion pounds. The shares were
down more than 12%.
The video-game retailer said the results were "delivered against
the backdrop of a very difficult trading environment, which saw the
global PC and video-games market decline by over 20%."
CEO Lisa Morgan has stepped down, with Chris Bell appointed CEO
on an interim basis, while the firm's chief operating officer for
the U.K., Terry Scicluna, will also step down.