Sector movers: Croda, Elementis lift chemicals sector higher
26 Jun, 2012 14:23
The chemicals sector was the best performing category on Tuesday afternoon on the back of decent performances by Croda International and Elementis.
Croda, the FTSE 100 manufacturer of speciality and oleochemical products, was trading around 2.5% higher after JP Morgan Cazenove upgraded the stock from 'neutral' to 'overweight' this morning.
"Croda's notable characteristic through the last downturn was one of resilience, and we see no evidence to suggest that this attraction is likely to wane," said JPMorgan analyst Martin Evans.
"The company's targeted 10 per cent growth through the cycle, while participating in high margins, product innovation and growth markets, should reassure investors," he said.
Meanwhile, on the second-tier index, rheological additives and pigment dispersions manufacturer Elementis jumped 3.5% after agreeing to buy Brazilian coatings additives company Watercryl Quimica for $24m.
The company expects the acquisition to provide a platform for its Specialty Products Division to expand in a fast growing market.
Heading the other way were the industrial engineers with Melrose among the stocks in the red despite saying that it has sold its injection moulding business, McKechnie Engineered Plastics, for over three times what it paid for it.
The engineering company sold McKechnie to global plastics group Rosti A/S for £30.7m in cash. The acquisition of McKechnie, along with the Dynacast businesses, in May 2005 for a net equity investment of £243.6m had resulted in total cash generation, including all disposal proceeds and the repayment of debt, of nearly £800m, Melrose said.
Top performing sectors so far today
Chemicals 7,900.32 +1.30%
Real Estate Investment & Services 1,625.18 +1.10%
Industrial Transportation 2,335.61 +0.96%
Insurance (non-life) 1,451.08 +0.78%
Mining 17,058.52 +0.74%
Bottom performing sectors so far today
Industrial Engineering 6,470.83 -0.68%
Automobiles & Parts 4,058.88 -0.52%
Oil Equipment, Services & Distribution 20,985.33 -0.50%
General Industrials 2,934.10 -0.47%
Electronic & Electrical Equipment 3,091.42 -0.40%