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UK stock market morning note (January 11, 2013)

The FTSE 100 is called to open higher this morning after closing at its highest level in 4 years yesterday helped by the ECB President's comments on Europe and the performance on Wall Street. Overnight we had Chinese inflation data out which was higher than expected at 2.5% with the economic diary this session focusing on the release of domestic manufacturing and industrial production figures and US trade balance data. Commodity prices are lower and on the foreign exchanges, both the pound and euro are weaker against the dollar.

Company Announcements

Tullow Oil Trading Statement and Operational Update reports that total revenue for 2012 is expected to be in the order of USD2.35bn, up from USD2.30bn in 2011. Group working interest production in 2012 averaged 79,200 boepd, a slight shortfall on its most recent guidance with production guidance for 2013 in a range of 86,000 to 92,000 boepd, which includes all gas assets currently held for sale. Sales volumes averaged 68,000 boepd in 2012 and sees an unsuccessful exploration write-off of USD299m and when combined with an asset value reduction in H1 2012 will give a total 2012 write-off of USD670m. Capex in 2012 was USD1.9bn and current estimates for 2013 are for USD2bn. This year it has over 40 wells in its high impact exploration and appraisal programme which will target one billion barrels of oil equivalent.

AGA Trading Update notes that it expects profit before non-recurring costs, finance costs and tax to be ahead despite the continuing economic headwinds. Overall revenues are expected to be 2% lower because of declines in Ireland and currency movements. It will see continued cost reduction measures in 2013 and at the end of 2012 had a net cash balance of over GBP5m.