U.K. Mining Stocks Rise, Led by BHP Billiton; Cadbury Drops

U.K. mining stocks rose, led by BHP Billiton and Anglo American Plc as metal prices increased.

Shares of Cadbury-Schweppes Plc dropped after the U.K. Food Standards Agency said it will probe why the company took six months to report traces of salmonella in some of its chocolate.

The FTSE 100 Index added 7.10, or 0.1 percent, to 5699.20 at 11:31 a.m. in London, with 46 stocks rising, 50 falling and 6 unchanged. The FTSE All-Share Index rose 0.1 percent to 2899.89. Ireland’s ISEQ Overall Index climbed 0.6 percent to 7347.95, buoyed by Kerry Group Plc.

BHP Billiton, the world’s largest mining company, added 2 percent to 1,014 pence. Anglo American, the No. 2 miner, gained 1.9 percent to 2,147 pence.

Copper prices increased in London on speculation that strong economic growth will boost demand for the metal, straining global supply.

“The miners are absolutely right,” to maintain a robust earnings outlook, said Giles Keating, global head of research at Credit Suisse Group in Zurich. “We’re going to have a slightly softer patch in the U.S. economy but it looks like it won’t be that long, or deep. Europe looks the same.”

Copper for delivery in three months gained as much as 2.1 percent to $6,920 per metric ton on the London Metal Exchange.

Cadbury shares fell 0.9 percent to 513.5 pence. The FSA “would have expected” to have been notified as soon as Cadbury found the bacteria in January, an agency spokesman who asked not to be identified said in an interview on June 24. The London- based company, the maker of Dairy Milk chocolate, reported the matter on June 19.

BA, Kerry

British Airways dropped 1.2 percent to 343.5 pence. The airline and rival Virgin Atlantic Airways are being sued in the U.S. for allegedly fixing prices on long-haul flights, the Sunday Times reported, citing a lawsuit filed in New York on June 23.

Kerry Group added 4 percent to 16.95 euros. Ireland’s largest foodmaker said it is starting a program to buy back 2.8 million shares, or 1.5 percent of its stock.

Reckitt Benckiser Plc gained 2.5 percent to 1943 pence after Johnson & Johnson agreed to pay $16.6 billion for the Pfizer Inc. unit that sells Listerine mouthwash, Rogaine hair treatment and Sudafed cold medicine. Reckitt Benkiser had been a potential bidder for the Pfizer division.

Mergers

“Reckitt Benckiser is up on relief that it may not bid for Pfizer’s unit,” said Jawaid Afsar, an independent trader at Securequity Ltd. in Sheffield, England, before the bid was confirmed.

Reports of possible mergers buoyed U.K. stocks. Shire Plc climbed 1.7 percent to 768 pence. Serono, a Swiss biotechnology company, is preparing to spend a total of $10 billion on acquisitions that may include U.K. drugmaker Shire, the Independent on Sunday said, citing an unidentified banker.

De Vere Group Plc advanced 4 percent to 847 pence after Permira Advisers Ltd. said it may bid for the hotelier. Private equity company Permira said it’s considering its next move after acquisition target De Vere agreed to be bought by AHG Venice Ltd. for about 723.5 million pounds ($1.32 billion).

Stanley Leisure Plc added 2.1 percent to 648 pence. The biggest U.K. casino operator and competitor London Clubs International Plc are in talks on a merger that would create a company with more than 50 properties.

The following stocks also gained or fell in the U.K. market. Stock symbols are in parentheses.

EMI Group Plc (EMI LN) gained 2.8 percent to 285.5 pence. The world’s third-largest music company is seeking a private equity partner to bid for BMG Music Publishing, the company being sold by Germany’s Bertelsmann AG, the London-based Times said, without saying where it got the information.

Filtrona Plc (FLTR LN) lost 2.3 percent to 278 pence. The cigarette filter maker spun off from Bunzl Plc last year said first-half results were “constrained” after administrative costs rose following the separation.

ISoft Plc (IOT LN) added 2.9 percent to 88.5 pence. BT Group Plc may bid for ISoft, a U.K. software company whose shares have fallen almost 80 percent this year, the Sunday Times reported, citing financial sources.

Quintain Estates & Development Plc (QED LN) rose 2.1 percent to 615 pence. The urban regeneration specialist was raised to “buy” from “neutral” by analysts at Merrill Lynch & Co.

Whitbread (WTB LN) jumped 22 percent to 1166 pence. The company returned money to investors in the form of B shares.

Wilmington Group Plc (WIL LN) jumped 9.6 percent to 197 pence. Metal Bulletin Plc, a U.K. conference organizer and publisher of magazines on metal markets, agreed to buy Wilmington Group for 163 million pounds ($296 million) in stock to form Bulletin Group.

Source: www.bloomberg.com