Signs of Rentokil turnaround spark rally

Rentokil Initial, the pest control and business services group, led the risers on the FTSE 250 this morning after posting a better-than-expected increase in first quarter profit. The 16% increase in profit has helped the company's share price to rise 8.25p to 74p. The company is one year into its turnaround plan, which aims to improve customer service, operational efficiency and cost control.

The publishing and events group Informa is also enjoying a good morning, gaining 36p to 333.25p, after it announced plans for a two-for-five share rights issue to raise £242m and said it will move its tax domicile to Switzerland. The company also released a trading update which is in line with market expectations. Polo Tang, analyst at UBS, kept his buy recommendation on the stock, saying: "We think the rights issue is a clear positive in that it should remove the biggest overhang on the stock, namely concerns about the balance sheet."

Following yesterday's rally that sparked talk of a new bull market, the FTSE 100 is now down 12.36 points to 4231.35. The largest faller is Land Securities, down 21p to 541.5p. The group has announced it is setting up a new venture capital arm to target overseas retailers, to help fill its vacant sites. The market has taken this move as an indication of the problems facing high street landlords following the collapse of many retail chains, with British Land falling 12.5p to 418.25p.

Following its rises over the last two days, Barclays is now down 8.5p to 273p. However, Royal Bank of Scotland continues to lead the risers on the FTSE 100, gaining 2p to 43.8p.

"With the sun shining and a scorcher of a May bank holiday on the way there is little or no interest on playing with volume today," said Manus Cranny of MF Global Spreads.

"The expectation is for a pause for breath as seen in the banks today excluding RBS - which the market feels is executing the most ruthless root and branch change process and will ultimately outperform their UK rivals."

The miners are also doing well as Citigroup raised its price target for Vedanta Resources from 725p to £12.30. Its stock was up 43p to £11.17, while Kazakhmys was also up 24p to 559p.