Footsie closes right side of 4000
The FTSE 100 Index planted itself firmly above the 4000 barrier today despite losing some ground in afternoon trading.
After building momentum throughout the morning, the key index managed to reach 4080 by early afternoon, a gain of almost 70 points.
But as prices in New York began to fall, the Footsie lost some of its progress to close up 37.9 points at 4049 – still its highest close since December 3.
Meanwhile across the Atlantic the Dow Jones Industrial Average was off 39 points at 8673 as London closed.
Despite the slip as the afternoon progressed, traders in London welcomed the sign that the Footsie appeared to have put some clear blue water between its level and the 4000 barrier.
Blue-chip shares took encouragement from yesterday’s gains and a frenzy of merger and acquisition activity.
With only 12 FTSE 100 companies in negative territory by the end of the day, the rally carried shares across the board upwards.
But some of the biggest gains of the day were to be found in the media sector as investors ventured back into an area which traditionally outperforms the market in a rally.
ITV company Granada led the Footsie risers board up 9% or 6p at 75p, just behind was Reuters which gained 7% or 12p to close at 174p.
And in the FTSE 250 Index, Granada’s potential merger partner Carlton Communications was among the risers – climbing 7% or 6.75p to end the day at 106.75p.
But among the Footsie’s losers were the utility companies, traditionally seen as a safe haven in times of trouble. With improved market confidence, Scottish Power was down 6.5p at 363.5p, United Utilities fell 1p to 619.5p and Scottish & Southern Energy lost 9.5p to 655p.
Insurance companies also benefited from the upbeat mood, with Legal & General up 3p at 89p, Norwich Union owner Aviva ahead by 11.75p at 442p and Prudential rising 4.5p to 402.25.
Banking stocks were also doing well. Barclays rose 8.75p to 424p, HBOS gained 13.5p at 728p and Lloyds TSB was also ahead, rising 6p to 430p after announcing the sale of its French wealth management operations to UBS.
Rising even higher was property investment group Chelsfield, which gained 57p, or 23% to 300p, after confirming that it had received a preliminary management buy-out approach from its chairman.
Investors welcomed a trading update from hotels giant Hilton which said that a strong performance for its bookmaking arm Ladbrokes helped offset the impact of the Iraq war and Sars outbreak on its hospitality business. Shares rose 2p to 172p.
Elsewhere battered advertising group Cordiant managed to climb 0.5p to 9.25p - a 6% rise – after saying that it had now reached a definitive agreement with its lenders to continue financing arrangements until July 15.
Earlier this month news of an agreement in principle on the arrangements cleared the way for the company to release its 2002 results just in time to avoid seeing its shares suspended.
The biggest risers were Granada up 6p at 75p, Reuters up 12p at 174p, Schroders up 39p at 656p and AMVESCAP up 18.75p at 367.25p.
The biggest fallers were Scottish Power down 6.5p at 363.5p, Unilever down 9.5p at 542.5p, Mitchells and Butlers off 3.5p at 217p and Scottish & Southern down 9.5p at 655p.
