LONDON -- Last week the FTSE 100
Spain's conveniently neglected crippled banks are not back to health after all, it seems, as the Valencia and Murcia regions are approaching the government for a bailout, leading to speculation that Spain is going to need an enormous national rescue. Spanish 10-year bond yields rose to 7.55%, and even Germany's rate was pushed up to 1.13%.
But even without the problems of the eurozone, companies can find themselves in trouble all their own. We look at three high-risk companies in the FTSE indexes that are not looking good today.
Oil trouble
Two of the biggest fallers in morning trading were oil and gas explorers Range Resources
The reason for the two was the same: a drilling report from the Shabeel North well in Puntland, Somalia. Each of the two companies has a 20% interest in the licenses in the Dharoor and Nugaal valleys. The drill operator, Horn Petroleum, holds the other 60%.
The problem? The area had shown sands containing evidence of oil, but a test drill that examined a 50-meter interval from 1,910 meters to 1,960 meters deep turned up only water with no traces of oil. Exploration will continue to a depth of 2,400 metres to determine whether there is anything of value down there.
Red Emperor's fall was the larger, as it has fewer other interests outside of Somalia.
Funding problems
The third crushing fall today came from Noventa
At the end of June, Noventa announced that it had approached institutional and other investors in search of a $35 million equity issue, but the company admitted today that there were no takers, and that issuing new shares is "no longer a viable option" for raising cash. If Noventa cannot now extend its loan facilities, it may become insolvent.
What now?
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