Takeover rumours spur FTSE to ten-point rise
Takeover speculation surrounding mining giant Rio Tinto helped keep the London market out of the red today.
Reports that BHP Billiton was eyeing Rio Tinto as a possible takeover target put the FTSE 100 Index on the front foot, up 10.1 points at 6560.6 by mid-morning.
Rio Tinto was the biggest riser, up 5%, or 165p at 3470p, while Kazakhmys was ahead 26p at 1204p and Xstrata rose 30p at 2741p. BHP Billiton added 25p to 1210p.
Accountancy software group Sage moved in the opposite direction after publishing half-year results in line with expectations. With the company looking to spend the next year integrating recent acquisitions, shares eased 10.75p to 257.5p.
But Antofagasta led the fallers’ board after a negative note from ABN Amro, which suggested now was the time to bank profits after the recent strong run in copper prices that have driven the group’s share price up 27% in the past two months. Shares were off 5%, or 25.75p, at 542.75p.
Meanwhile shares in media group Reuters lost 2%, or 12p, to 618p, easing back slightly from the gains seen at the close yesterday after Thomson outlined plans for a £8.8 billion move to acquire the group. Broker Societe Generale downgraded Reuters from buy to hold, saying there was only a 50/50 chance of the deal succeeding.
There was also a disappointment in the FTSE 250 Index after pubs chain JD Wetherspoon said the cost of its preparations for the smoking ban in England would leave profits slightly lower than expected. Shares were down 32p at 678p.
EasyJet fell for a second successive session after its warning on Tuesday that fares were under pressure from competitive trading conditions. While half-year losses came in better than expected at £17 million, easyJet’s shares still fell another 23.5p to 608p, a drop of almost 4%.
