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(ShareCast News) - Food producers were the top rising sector on Thursday thanks entirely to Associated British Foods, a major sugar producer, bread baker, food and ingredients producer under brands such as Twinings Ovaltine and Australia's George Weston Foods.
While its sugar and ingredients arms had solid third quarter and provide half group profits, it was the performance of clothes retail arm Primark that impressed the market and lifted full year expectations. Primark sales grew 21% in the for the 40 weeks to 24 June and 15% at constant currency rates versus the 22% at actual rates and 12% constant in the first half of the year.
This helped boost group sales to 20% at actual rates and 13% at constant currency for the third quarter, and to 20% actual and 10% constant for the 40 weeks of the year to date.
The "stellar" update was so impressive, said Credit Suisse, that it raised full year earnings estimates by 1% and upped its price target to £33.50 from £32. "Primark clearly holds the key to valuation here, and this update confirms it is in robust health." Analysts said the shares look good value for such a structural growth story at Primark "that looks in pretty good health".
Oil services and engineers stocks were down despite a rise in oil prices. By late afternoon on Friday, Brent crude futures were up more than 2.2% to $48.88 a barrel, recouping most of the previous session's losses.
Government Data on US crude oil and product stockpiles showed rapid shrinkage during the latest reference week. Commercial oil inventories fell by 6.3 millions barrels during the week ending on 30 June to reach 502.9m, according to the Energy Information Administration, the US Department of Energy's statistical arm. In parallel, gasoline inventories fell by 3.7m barrels and those of distillates by 1.9m.
Top performing sectors so far today
Food Producers & Processors 8,382.39 +1.08%
Banks 4,477.25 +0.71%
Insurance (non-life) 3,109.42 +0.60%
Industrial Metals & Mining 2,568.87 +0.51%
Industrial Transportation 3,095.95 +0.28%
Bottom performing sectors so far today
Forestry & Paper 21,402.69 -1.78%
Oil Equipment, Services & Distribution 11,900.79 -1.61%
Electronic & Electrical Equipment 5,748.31 -1.54%
Pharmaceuticals & Biotechnology 13,946.80 -1.40%
Construction & Materials 6,747.83 -1.37%
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