FTSE close: ARM, BSkyB, Northern Foods up
›› Stock market outlook for 2011
17.00 (close)
The FTSE 100 Index closed in on the 6000 mark today as investors shrugged off disappointing economic data from the UK and US.
London's top tier closed 31.7 points higher at 5983.5, despite official figures revealing the UK economy had not grown as strongly as thought in 2010, with GDP growth downgraded for the last three quarters.
On the other side of the Atlantic, America's GDP rate was revised upwards for the third quarter from 2.5% to 2.6% - but by less than expected.
The weak UK growth figures hit the pound, which fell to 1.53 against the dollars and 1.17 against the euro.
In London, banking and mining stocks continued to push up the Footsie amid thin trading volumes.
Investors piled into BSkyB after business secretary Vince Cable lost his power to block a takeover approach by Rupert Murdoch's News Corp.
BSkyB shares rose 2%, up 14.5p to 743p, as Investec Securities said the probability of News Corp being given the green light to acquire the remaining 61% of BSkyB it does not already own had risen to 90% from 66%.
The final decision rests with culture secretary Jeremy Hunt, who is due to receive a report on the matter from regulator Ofcom at the end of the month.
Banks continued an improved run, as reports suggested China was prepared to buy debt from ailing Portugal. The country is tipped by analysts to follow in the footsteps of Ireland and Greece and seek an EU-funded bailout.
Lloyds was up 0.5p at 68.9p, Royal Bank of Scotland added 0.5p to 40.7p, and HSBC gained 6.6p to 669.4p. But Barclays, which is closely tied to the Iberian peninsula, slipped 0.9p to 267.5p.
British Airways pulled back from losses earlier this week, lifting 2%, as the Christmas travel outlook improved.
Heavy snow and icy temperatures shut the second runway at Heathrow airport and led to thousands of passengers being stranded. But as the weather forecast improved today, travel operators started to tackle lengthy backlogs and passengers were back on the move. BA shares added 5.2p to 273.6p.
Outside the top flight, Northern Foods jumped 4% as it confirmed interest from food tycoon Ranjit Boparan in making an offer for the Fox's biscuits owner and gatecrashing an existing deal with Ireland's Greencore. Shares were up 2.5p to 63p.
In other takeover developments, outsourcing firm Mouchel rose 32% after Costain said it had made an all-share approach valuing the embattled company at around £118 million.
The bid was rejected by Mouchel, which said this month it had received buy-out interest from a number of parties. Shares were up 23.3p to 96.2p.
The biggest Footsie risers were ARM Holdings up 36.8p at 440.3p, Carnival ahead 154p at 3059p, Schroders up 47p at 1482p and Scottish & Southern ahead 30p at 1233p.
The biggest Footsie fallers were 3i Group down 5.2p at 330p, Smiths off 15p at 1255p, Inmarsat down 7.5p at 678p and Amec off 9p at 1159p.
15.45:The Dow Jones is trading flat after third quarter US GDP growth was revised upwards from 2.5% to 2.6%, but undershot expectations. The index is up 3.3 points at 11536.5.
The lacklustre sentiment across the Atlantic has had little impact in London. Trading is thin as Christmas approaches, but the Footsie has edged up further to trade 28.1 points higher at 5,979.9.
12.30:
Lunchtime update – the FTSE 100 is holding onto gains and trading up 20.9 points at 5,972.7.
Figures showing that the UK economy did not grow as robustly as thought in the third quarter failed to dent the upbeat end-of-year mood.
The Office for National Statistics said July-to-September growth was 0.7% rather than the 0.8% initially reported.
Reports that China is planning to buy Portuguese government bonds soothed concerns about the eurozone debt crisis and sent bank stocks higher.
Royal Bank of Scotland rose 0.67p to 40.85p, while Lloyds Banking Group was up 0.7p at 69.19p and HSBC put on 0.5p to 663.3p. Barclays, which is exposed to Spanish and Portuguese debt, bucked the trend and fell 0.7p to 267.65p.
British Airways made it back onto the risers board after the UK's transport gridlock started to ease. Its stock was up 5.3p at 273.70p as the weather forecast improved and the backlog of stranded passengers began to clear.
Futures trading indicates that the Dow Jones in New York is likely to open lower. Investors are showing caution ahead of US home sales data and the final estimate of third-quarter GDP later.
10.00
The Footsie this morning advanced further from yesterday's 30-month closing high with gains for ARM and BSkyB.
The FTSE 100 index was 16.1 points ahead at 5,967.9, as investors betted that News Corp's takeover of BSkyB will go ahead after business secretary Vince Cable lost his power to block the deal.
Traders are still eyeing 6,000, a level not seen since early June 2008. The index has gained 7.6% so far since the start of the year, on track for its biggest monthly percentage gain since July 2009.
'I'd say 6,000 is definitely the way (the FTSE 100's) going to go, and I think potentially by the end of the year,' Phil Gillett, a trader at Spreadex, said.
BSkyB shares rose more than 1%, up 10.5p to 739p, as Investec Securities said the probability of News Corp being given the green light to acquire the remaining 61% of BSkyB it does not already own had risen to 90% from 66%.
The final decision rests with culture secretary Jeremy Hunt, who is due to receive a report on the matter from regulator Ofcom at the end of the month.
ARM Holdings jumped 31.1p to 434.6p to a nine-year high on reports Microsoft is working on a new version of its core Windows operating system for devices such as tablets, marking the first time that the software would run on processors designed by the British firm.
RBS analyst Didier Scemama said such an alliance could be a game changer for ARM: 'The big event would be if this is a first step towards full support for ARM in notebooks, desktop and servers,' he said.
National Grid, Britain's biggest utility, rose 1.5p to 565.5p, with traders citing the cold weather conditions in the UK which are boosting demand for energy.
Outside the top flight, Northern Foods jumped 7%, or 4.5p to 65p, as it confirmed interest from food tycoon Ranjit Boparan in making an offer for the Fox's biscuits owner and hijacking an existing deal with Ireland's Greencore.
In other takeover developments, outsourcing firm Mouchel rose 16% or 12p to 85p after Costain said it had made an all-share approach valuing the embattled company at around £118m.
It was rejected by Mouchel, which said this month it had received buy-out interest from a number of parties.
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