Footsie hits new three-year high
Takeover talk swirling around internet bank Egg helped the FTSE 100 Index hit a fresh three-year high today.
Insurer Prudential, the majority owner of Egg, was driving progress following a report that US investment bank Citigroup was pondering a potential £1 billion bid.
This contributed to the Footsie moving 10.2 points higher to 5242.4, proving the market’s resilience following Thursday’s bomb attacks in London.
A fall in the cost of oil also helped the mood. News that a hurricane in the United States had caused no damage to oil rigs or refineries helped the cost of a barrel of US light crude oil to fall below 59 US dollars in New York.
The Dow Jones Industrial Average had climbed around 70 points shortly after London’s close, adding to the momentum.
Back in London, The Pru was the second highest riser, lifting nearly 3% or 15p to 528.75p. The takeover talk moved FTSE 250 stock Egg 8% higher, up 8.5p to 113.75p.
Telecoms giant Vodafone was another top-flight climber as it benefited from a positive note from broker Dresdner Kleinwort Wasserstein, adding nearly 1% or 1.75p to 141p.
A series of other insurers followed The Pru into the black, with Norwich Union owner Aviva advancing 9.5p to 627.5p and Royal & Sun Alliance cheering 1.25p to 85.75p.
Banking stocks also made progress, led by Lloyds TSB up 8p at 485.75p. Northern Rock lifted 1% or 9.5p to 810p.
Amongst companies making announcements today, bookmaker William Hill added 2.5p to 561p after it said it had sold a batch of sites to the Tote. The move is part of moves to ease competition concerns following a recent deal to buy more than 600 sites from Stanley Leisure.
But oil giant Shell was heading in the opposite direction, with the lower oil price leaving it the heaviest blue-chip faller – off nearly 3% or 15.25p to 548.75p. Rival BP also lost out, down 7.5p at 634p.
Elsewhere, shares in housebuilder Taylor Woodrow gained 4.5p to 345.25p as it announced that half-year profits would be slightly ahead of expectations, although it warned that UK market conditions remained challenging.
Shares in other housebuilders failed to move far after the update, with Redrow half a penny higher at 418.5p and Persimmon unchanged at 796p.
Somerfield added a penny to 197p as investors had their first chance to react to news that Icelandic investment group Baugur was pulling out of the bidding battle for the supermarket group.
Beleaguered Channel Tunnel group Eurotunnel saw its shares slip 4% or 0.75p to 17.25p despite unveiling higher revenue and traffic figures.
Associated British Foods weakened 5p to 835.5p after clothing retail subsidiary Primark said it was taking on 120 Littlewoods stores.
The highest Footsie risers today were Amvescap up 13.25p to 432.75p, Prudential adding 15p to 528.75p, Yell up 9.5p to 453p and Sage rising 4.5p to 228.5p.
The heaviest fallers were Shell falling 15.25p to 548.75p, Imperial Tobacco down 22p to 1478p, Diageo off 10p to 790p and Gallaher down 10p to 813p.
