From UK-Analyst.com: Monday 12th July 2010

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The U.K's latest recession was the worst in post-war British history, the Office of National Statistics reported. It also found greater reliance of the economy on the state as government spending rose by 1.5% rather than the 0.5% initially calculated. Meanwhile, international migration fell in 2008, reversing the trend of the previous five years, reflecting a fall in demand for labour among the world's large, industrialised countries, according to the Organisation for Economic Co-operation and Development's annual International Migration Outlook.

At the London close the Dow Jones was down by 19.91 points at 10178.12 and the Nasdaq was down by 8.36 at 2188.09.

In London the FTSE 100 was up by 34.08 points to 5167.02; the FTSE 250 was up by 28.37 points to 9774.16; the FTSE All-Share was up by 16.04 points at 2668.69; and the FTSE AIM Index was down by 1.94 points to close at 666.9.

Brokers' Notes

Collins Stewart believes that the six weeks before Rightmove's (RMV) results is the best time to "BUY" into the estate agent, on which it has a target price of 819p. The research house is expecting "impressive" results in the first half of 2010, with a 22% rise in revenues to 41 million pounds, and a 38% increase in earnings per share to 16p. This follows Rightmove returning 28.7 million pounds to investors as well as the sale of Holiday Lettings on 24th June. Furthermore, a trading statement for the second half of 2010 is expected to be positive, reflecting increased usage of Rightmove by home hunters and increased adoption of additional products by advertisers. The shares pushed forward by 0.5p to 616.5p.

Edison Investment Research commented on mining company Red Rock Resources'* (RRR) "significant" investment in Mineras Four Points (MFP), which owns and operates two Colombian gold mines. The research house said that, although its investment is initially in the form of a 2 million dollars (1.3 million pounds) loan plus consultancy services, the mining group has also been granted call options over 51% of MFP's equity. These have the potential to add up to 50% to the firm's current sum of the parts valuation, Edison reported. Red's shares moved forward by 0.2p to 2.175p.

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Panmure Gordon reiterated its "HOLD" recommendation, and 875p target price, for ASOS (ASC), as the online clothing retailer is due to announce a trading update for the three months ended 30th June. With reported increased sales of 58% for the first quarter in 2010, the broker does not expect a "significant" deviation from this trend. However, any evidence that sales growth strength has been maintained will be good news, Panmure added. Furthermore, the stockbroker noted that unwinding of the 9% short position which currently exists in the stock, together with further stake building by Danish supplier Bestseller, could mean that its target price/earning to growth ratio may be exceeded in the near future. The shares dropped by 7p to 883p.

Seymour Pierce re-iterated its "BUY" recommendation and 52p target price for Advanced Medical Solutions (AMS). This comes after the wound-care company updated investors last week with a presentation focused on its commercialisation strategy and research & development pipeline. While there was an emphasis on opportunities for the medium term, the event served as a reminder of the group's virtues that have driven a share price rise of 80% over the last 12 months, Seymour commented. The research house believes this to be a "quality business". Medical Solutions shares increased by 1.75p to 48.5p.

Blue-Chips

BP (BP.) shares jumped up by 34.3p to 399.1p after the oil giant said the new system to contain the Gulf of Mexico spill was preceding as planned, and press reports indicated a number of companies to be interested in buying, at least some of, BP's assets. The company said that the installation of a sealing cap over the leaking Macondo well was proceeding as planned. The new sealing-cap system, plus other measures, is expected to allow the recovery of 60,000 to 80,000 barrels of oil a day in two to three weeks, the group reported. The Financial Times, meanwhile, reported that China's biggest listed oil and gas producer PetroChina Co., would "welcome" closer co-operation with BP, while a report in the U.K.'s Sunday Times suggested that Exxon Mobile Corp. was considering a 100 million pound bid for BP after receiving White House approval. Meanwhile, the oil giant said the cost of its response had reached 3.5 billion dollars (2.3 billion pounds).

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Standard Chartered (STAN) has agreed to acquire GE Commercial Financing (Singapore), a specialist in small and medium sized enterprises (SME) factoring and hire purchase financing in Singapore, for an undisclosed fee. Standard Chartered regional head of consumer banking Ajay Kanwal commented, "This acquisition is strategic as it adds capability to our SME business, further strengthens our franchise in Singapore and helps us become a core bank to our SME customers. The gross assets of GE were 132 million dollars (88 million pounds), as of 31st December 2009. Shore Capital does not expect that the transaction will have a material impact on the group's accounts. Nevertheless, trading at an attractive tangible book value, the research house issued a "BUY" recommendation. The shares was up by 5p to 1,723.5p

Rio Tinto (RIO) shares fell by 75.5p to 3,097p on news the mining giant has refereed to arbitration an alleged breach of a private placement agreement with its joint venture partner, Canadian miner Ivanhow mines. The group has accused Ivanhow of breaching a private placement agreement entered into in March by going ahead with a shareholder rights plan despite objections from Rio Tinto.

Mid-Caps

Thomas Cook Group (TCG) shares declined by 4p to 187.5p after it agreed to acquire Oger Tours, a German tour operator specialising in package holidays to Turkey, for 30 million Euros (25 million pounds). In the year ending 31st October 2009, Oger Tours carried more than 400,000 passengers, and reported gross revenues of 256 million Euros (215 million pounds) and operating profit of 3.3 million Euros (2.8 million pounds). Through the acquisition the travel group expects to strengthen its market position in Germany and further increase its presence in Turkey.

Kier Group (KIE) shares rose by 36p to 979p subsequent to the integrated construction and property services group announcing that it expects to report full year underlying profit before tax towards the "upper end of current market expectations and ahead of last year's result." Net cash balances during the year have been "strong" ending the financial year in June at a record level of over 170 million pounds, the firm commented. This is said to reflect the quality of its order books and strategy to reduce the company's investment in the Partnership Homes business. Meanwhile, in a separate announcement, Kier has appointed Haydn Mursell as finance director designate, taking over from Deena Matter upon her departure on the 18th August 2010. Encouraged by this, Arbuthnot issued a "STRONG BUY" recommendation, following upside of 39% to its 1,310p target price.

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Domino's Pizza* (DOM) was given a sales boost by the World Cup and its sponsorship of Britain's Got Talent. It reported a 13.7% rise in like-for-like sales in the six months to the end of June, with pre-tax profits up 28.6% to 17.5 million pounds and the dividend up a similar amount to 4.5p a share. The company talks of "solid and steady sales growth, supported by innovative marketing," in an appeared attempt to stop investors assuming there will be a slow down now that these events are over. Panmure Gordon has increased its full-year estimates for profits before tax by 4% to 35 million pounds. However, the research house continues to expect like-for-like sales growth to slow dramatically in the second half and hence retained its "SELL" recommendation

Small Caps, AIM and PLUS

Ariana Resources (AAU) shares edged forward by 0.5p following the Turkey focused gold miner announcing the completion of a joint-venture agreement with Proccea Construction on its Red Rabbit project in western Turkey. The 50-55% joint-venture has been established with Proccea committing 8 million dollars (5 million pounds) to develop the project, which will ultimately lead to Ariana becoming the next gold producer in Turkey.

WFCA (WFCA) shares moved forward slightly by 0.48p to 2.23p after the advertising and marketing agency reported "beating market expectations." The financial performance of the company in the second half of the financial year has exceeded forecasts despite a challenging and competitive environment, the company said in a trading update.

Falkland Oil and Gas (FOGL) shares crashed by 104p to 97.75p after the oil explorer said that it had abandoned its first exploratory well with no oil being discovered. The Toroa F61/5-1 explorations well was drilled to a total depth of 2476 metres and was the first well in a previously undrilled frontier basin. Despite the disappointment, the company believes that these results have helped to reduce some of the key risks of the plays in the deepwater areas of its licences. The firm will now evaluate all data and information gained. Fox-Davies Capital remains optimistic in the evaluation, issuing a "BUY" recommendation.

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European Nickel (ENK), the nickel laterite company, has entered into a binding letter agreement for a strategic partnership with the mineral explorer Hunter Dickinson through a two tranche, non-brokered private placement with its affiliate Constantia Resources. The first and second tranche will raise 3.36 million pounds and 36.7 million pounds, respectively. In addition, upon finalisation of the Caldag project finance facility, the group will seek to raise a further 13.4 million pounds through a private placement to existing institutional shareholders. Both companies have expressed belief that Caldag - European Nickel's flagship asset - will become a significant, near-term nickel producer. The shares climbed up by 6.75p to 23.75p.

ReNeuron Group (RENE) shares edged forward by 0.72p to 4.7p as it reported its results for new stem cell techniques that could extend the life of stroke victims. The results of these studies will be presented in two posters at the UK National Stem Cell Network Annual Scientific conference in Nottingham. The group will announce that its stem cell product has undergone further pre-clinical testing and is working better than expected both in expanding the blood vessels and reducing the inflammation associated with a stroke, thereby aiding the natural healing processes in the brain.

Angel Mining* (ANGM) shares fell by 0.75p to 5.75p on news the Greenland focused mining company has agreed an additional bridging loan of 4.5 million dollars (3 million pounds). The firm said it would use the loan to fund operations at Nalunaq gold mine and for general working capital purposes, until is finds a longer-term financing solution. Consequently, the mining company has access to sufficient capital to allow it to move into full production and achieve positive cash flow. Furthermore, the group said it is in advanced talks with another party for a new 100 million dollars (67 million pounds) debt facility, which would include equity subscription rights. While the critical funding may be within reach and if that occurs the upside for investors is likely to me material, GE&CR* has "SUSPENDED" its recommendation and target price until Angel's long term financing is confirmed.

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* Red Rock Resources and Angel Mining are corporate clients of Rivington Street Holdings (RSH), the ultimate owner of this website. The SF t1ps Smaller Companies Growth Fund, which is managed by a subsidiary of RSH, owns shares in Angel Mining and Domino's Pizza.