Tuesday March 25, 12:32 PM
London shares stay higher midday; NY seen extending gains; banks rally
LONDON (Thomson Financial) - London shares stayed at higher levels in midday deals, as Wall Street looks to extend recent gains, with UK banks rallying following news of a revised Bear Stearns (NYSE: BSC
- news) offer.
At 12.07 pm, the FTSE 100 index was up 192.5 points at 5,687.7, having reversed from a high of 5,704.3, with the FTSE 250 (news) index 348.6 points firmer at 9,797.
Volume was solid, with 1.18 bln shares changing hands in 382,123 deals.
According to spread bettors IG Index, the Dow Jones Industrial Average is expected to open around 48 points firmer at 12,597.
Yesterday stocks ended sharply higher on an improved buyout offer from JP Morgan for beleaguered investment bank Bear Stearns, with a stronger-than-expected housing report underpinning gains.
The Conference Board's index of consumer confidence is expected to show a further decline in March, with Thomson (Paris: FR0000184533 - news) 's IFR Markets attributing the fall to rising oil and gas prices.
Back with UK equities, in midday deals Royal Bank of Scotland (LSE: 90ID.L - news) took on 28-1/4 pence at 349-1/2, Alliance & Leicester was 38-1/2 pence ahead at 576-1/2, and with Lloyds TSB gaining 25-1/2 to 459-1/2.
News of director share purchases aided gains from HBOS (LSE: HBOS.L - news) , hit last week by false rumours of a Bank of England bailout. Its shares climbed 65-1/4 to 539. Meanwhile, Barclays (LSE: BARC.L - news) climbed 44 to 473 as Merrill Lynch (NYSE: MER - news) reiterated its 'buy' rating and 600 pence target on the group.
Other financials were also in favour with insurers helping to give the FTSE 100 a boost.
Standard Life (LSE: SL.L - news) was 14-3/4 higher at 249-1/2, Aviva (LSE: AV.L - news) climbed 28-1/2 to 619-1/4, while Old Mutual (LSE: OML.L - news) was up 8.4 at 113.7.
Housebuilders experienced gains following yesterday's US home sales data, with Taylor Wimpey (LSE: TW.L - news) up 21 at 184.8, and Persimmon (LSE: PSN.L - news) climbing 56-1/2 to 755. Among midcaps, Bovis Homes ticked up 51-1/2 to 575, Redrow (LSE: RDW.L - news) took on 25-1/4 to 295-1/4 and Bellway (LSE: BWY.L - news) , ahead of interim results tomorrow, gained 70 to 823.
Away from housebuilders, and also gaining ahead of earnings later in the week, Kingfisher (LSE: KGF.L - news) added 11.1 to 136.1.
Bid talk provided the impetus for shares in British Energy (LSE: BGY.L - news) , 39-1/2 ahead at 661. According to a report in the Sunday Times, Centrica (LSE: CNA.L - news) is examining a 10 bln stg bid for the nuclear power company.
Meanwhile, Yell gained 24.1 to 162.1, on a technical rebound.
Among today's mere handful of casualties, Morrison shed 1-1/2 to 278, as Merrill Lynch downgraded the group to 'neutral' from 'buy' and Cazenove cut its stance to 'in-line' from 'outperform'.
On the second tier, Filtrona (LSE: FLTR.L - news) was 15-1/2 firmer at 168-1/2, as UBS (Virt-X: UBSN.VX - news) upgraded the group to 'neutral' from 'sell', while cutting its target to 165 pence from 180 pence.
Turning to the fallers, Mouchel Group was off 5-1/2 at 447-3/4, ahead of interims on Monday.
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