By Nick Kostov
LONDON (MarketWatch) -- The FTSE 100 was little changed on
Friday as well-received earnings at publishing giant Pearson PLC
and gains at banks failed to offset losses at Rolls-Royce Holdings
PLC, Royal Bank of Scotland PLC and British Sky Broadcasting Group
PLC.
The benchmark lost 0.28% to stand at 6,569.14, and is heading
for a decline on the week after posting losses on three of the
other four days so far. It had previously edged higher in morning
trading.
Among notable gainers in the index, shares of Pearson PLC ,
which publishes U.K. newspaper the Financial Times, rose 6.87%
after the company reported a swing to loss but a 5% rise in sales.
Loss for the first half was 8 million pounds, compared with a
profit of GBP36 million a year earlier, as the publisher continues
to restructure its business to increase its focus on digital
education and high-growth markets.
U.K. banks were getting a boost on Friday. Analysts at Credit
Suisse upgraded the sector to overweight from benchmark, citing
"clear signs" of macro improvement in the euro area and attractive
valuations. Banking giants Standard Chartered PLC and HSBC Holdings
PLC were up 0.62% and 0.72% respectively.
Shares of Rolls-Royce Holdings PLC slipped 3.15% on Friday
morning after a 5.1% jump yesterday on the back of an earnings
report. Rolls-Royce reported a 34% climb in its pretax profit but
Chief Executive John Rishton told reporters the company needs to do
more do cut "unacceptable" levels of costs, according to
Reuters.
"Rolls-Royce is contending with a bout of profit-taking
following its surge to a brand-new high yesterday. It has fallen
3.35% on the day, as Deutsche Bank and [Societe Generale] trip over
themselves to downgrade price targets for the U.K.-based company,"
said Brenda Kelly, senior market strategist at IG, in a note
Friday.
British Sky Broadcasting Group PLC slipped 2.06% despite
reporting revenue for the year of GBP7.24 billion, slightly ahead
of consensus and up on revenue of GBP6.79 billion in 2012. Total
customers were up slightly to 14.83 million from 14.28 million.
"BSkyB investors have shrugged aside reasonable results and a
GBP500m share buyback, as increasing competition weighs on the
share price," Rebecca O'Keefe, head of investment at Interactive
Investor, said in a note Friday.
Rounding off a big day for earnings for London-based companies,
BG PLC , a natural gas company, was up 1.60% on news of an increase
in pretax profit to $1.45 billion for the second quarter, up from
$519 million a year earlier. Mining company Anglo American PLC was
up 2.09% despite posting a drop in first-half profit, which it said
was due to falling commodity prices.
Water firm United Utilities Group PLC gained slightly after
saying it is trading in line with expectations, and Spectris PLC, a
productivity-enhancing instrumentation and controls company, was up
1.25% on the news it doubled pretax profit during the half
year-end.
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