London market boosted by surge in Rolls-Royce shares

THE London market was given a leg up yesterday by a surge in Rolls-Royce’s shares and an upbeat start to trading on Wall Street.

By the close of dealing, the FTSE 100 Index was up 69.9 points at 4434.7 - its highest close for six weeks, and reversing a subdued close on Wednesday.

Healthy trading in the US helped sentiment on this side of the Atlantic, as Wall Street’s recent rally continued.

In London, most sectors were gaining, but the biggest riser by far was engine maker Rolls-Royce which powered 15% ahead. The group reported a sharp fall in profits, but results came in at the top end of analysts’ expectations and the group also reassured the market over its debt levels. The stock, which has been hit hard by the impact of September 11 on the aviation industry, soared 20p to 154p on the update. Telecoms, oil and pharmaceutical stocks were also helping pull the market higher. Mobile phone giant Vodafone was up 4p at 110p, while rival mmO2 jumped 5p to 53p and Cable & Wireless moved 5p higher to 169p. Oil giants BP and Shell were buoyed by the recent rise in the oil price - which held up yesterday. BP was up 15p at 537p, while Shell rose 12p at 453p.

Biggest risers: Rolls-Royce up 20p at 154p, mmO2 up 5p at 53p, Invensys up 5p at 80p and Corus up 4p at 59p.

Fallers: AB Foods down 19p at 594p, Smith & Nephew down 11p at 355p, Aviva down 11p at 539p and Imperial Tobacco down 15p at £10.60.