Insurance helps Footsie climb
A clutch of insurance stocks helped drive the London market higher today after an update from Friends Provident cheered the sector.
The stock was the highest top flight climber after saying an increase in business from independent financial advisers helped it boost UK sales by a fifth - leading to significant gains by rivals such as Aviva and Legal & General.
The momentum helped the FTSE 100 Index close 59.5 points higher at 4861.2, as it clawed back ground lost during a difficult few sessions last week.
With first quarter UK sales up to £88 million, from £74 million last time, Friends shares stood 4% higher, lifting 6.5p to 167p. Legal & General and Aviva also advanced 2% each, up 3p and 12.5p to 107.25p and 601.5p respectively, and Royal & Sun Alliance added 0.75p to 76.25p.
Takeover talk also fuelled today’s gains as speculation over B&Q-owner Kingfisher made the stock the second highest Footsie climber. Kingfisher gained 3%, or 8.25p to 253.75p, after a broker said weekend reports that private equity groups were considering bids could be near the mark.
The mood in the City was more upbeat than that across the Atlantic, where the Dow Jones Industrial Average was broadly flat ahead of an announcement on US interest rates. However, progress yesterday had boosted the Footsie in early trading.
Back in London, oil giant Shell lifted 1.5p to 471p as investors welcomed news that it had reached a long-term gas exploration and development agreement with Libya’s National Oil Corporation. It marks the company’s first major project in the country for 30 years.
Rival BP also advanced 4.5p to 538.5p despite a slight fall in the cost of a barrel of US light crude to just above 50 US dollars today.
Elsewhere, Marconi shares recovered some of their recent weakness, gaining 7% after it announced it was considering “all strategic options”. With a sale of the business seen as an increasing possibility, the stock rose 19.5p to 281p.
Shares in discount clothing retailer Matalan also lifted after reports said it was likely to sell jeans business Lee Cooper. The stock put on 2% or 4p to 193p.
And food producer Dairy Crest, whose brands include St Ivel Gold, added 1.25p to 437.25p after saying it was in advanced talks to buy the dairy operations of Midlands Co-operative Society. MCS produces more than a million pints of milk a year.
Hotel Corporation, which part-owns a string of four star hotels such as Edinburgh’s Carlton and the Oxford Hotel in Oxford, cheered half a penny to 129.5p after posting “excellent” maiden results.
The biggest Footsie risers today were Friends Provident up 6.5p to 167p, Kingfisher adding 8.25p to 253.75p, Cadbury Schweppes up 17p to 542p and ICI adding 8p to 259.75p.
The heaviest fallers were ITV down 2p to 119p, Yell off 5.5p to 395.75p, BSkyB down 7p to 533p and National Grid Transco falling 5.25p to 509.5p.
