FTSE close: BP, Vodafone up; Barclays down

By ADRIAN LOWERY
Updated: 12:01 EDT, 12 October 2009

The London market saw more gains today taking the Footsie to fresh 12-month highs.

Taking its lead from a strong finish on Wall Street on Friday, the FTSE 100 index closed 48.3 points higher at 5,210.2. The gains were driven by a number of heavyweight stocks, such as Vodafone, oil giant BP and pharmaceuticals firm GlaxoSmithKline.

David Jones, chief market strategist at IG Index, said today's latest landmark was a significant breakthrough for investors.

He added: 'This area had successfully capped any strength since the middle of September and today's levels are the highest seen for more than a year, which should help banish any worries that the recovery was running out of steam.'

On Wall Street, the Dow Jones crept closer to the all-important 10,000 watershed - not breached in a year - with a 39.3 rise to 9,904.24 at the London close.

It's a busy week on Wall Street from tomorrow, with JPMorgan Chase, Goldman Sachs, Citigroup, Bank of America, Intel, Google and IBM all reporting.

Despite the upbeat mood for British shares, the pound took a pummelling. Sterling fell to its lowest level against the euro in more than six months this morning following Gordon Brown's announcement of a £16bn sale of state assets such as the Channel Tunnel rail link, the Tote bookmaker, the Dartford river crossing and the student loans book.

The pound fell to €1.068 from €1.078 as traders interpreted the asset disposal plan as a desperate effort to plug the massive hole in public finances.

Energy stocks were among the risers in London as oil prices rose above $71 a barrel. BP saw a gain of 9.7p to 552.2p, and Tullow Oil was 17p higher at 1,225p.

BG Group, which rose 11p to 1,112p, was also helped by a Sunday Times report which said the British gas producer has received an unsolicited bid for most of its £1.5bn power generation business and could announce a sale shortly.

›› 'Gas prices too low against oil' - should you invest?

There was a rise of 2.05p to 134.5p for Vodafone after it announced plans to transfer its US listing to the Nasdaq exchange. The move is expected to result in lower annual listing fees.

And drugs group GlaxoSmithKline saw an improvement of 17.5p to 1260.5p.

Last week's strong run in mining stocks continued with Randgold Resources gaining 11p to 4652p and Antofagasta rising 4.5p to 828p.

Lloyds Banking Group was 2.39p lower at 91.6p after the Sunday Times reported the lender has lined up a syndicate of investment banks to underwrite an £11bn rights issue, with UBS and Bank of America Merrill Lynch to act as lead underwriters.

Barclays was down 4.35p at 372.65p after the Financial Times reported the lender is planning to spin off a £4bn portfolio of complex credit assets as it presses ahead with a process to clean up its balance sheet.

Royal Bank of Scotland was 0.24p down at 48.1p after sources close to the lender told the Independent on Sunday that the bank's advisors, Morgan Stanley and Hoare Govett, have suggested a public listing of car insurer Churchill in a move which could raise billions of pounds.

Outside the top flight, ITV shares rose 0.95p to 47.33p after its succession saga was offset by a positive note from Goldman Sachs. The broker said evidence from media buyers pointed to a stronger-than-expected recovery in advertising markets for the final two quarters of the year.

However, ITV's leadership crisis is no closer to ending after the company said Sir Michael Bishop was not in the running for the chairman's position and chief operating officer John Cresswell will leave the company on the arrival of a new chief executive.

Shares in building supplies firm Speedy Hire fell more than 11.5% - down 5p to 38.25p - after it said first half sales were down 29% and warned there was no sign of a return to usual seasonal trends.

Meanwhile, retailer JJB Sports jumped 2p to 34.75p after it pressed ahead with plans for a £100m rights issue. It was forced to postpone the fundraising on Friday due to unfounded rumours about payments to chairman Sir David Jones.

International Personal Finance saw its shares rise more than 15%, or 27.9p to 209.9p, hitting a one-year high, after it said full-year results are likely to be ahead of current market expectations.

The emerging markets lender said the outlook for the economies it operates in has improved after making good progress in the third quarter.