Telecom stocks lead shares rally

Telecom stocks are spearheading a revival in the London market that has added 126.8 points to the FTSE-100 Index.

Telecom stocks are spearheading a revival in the London market that has added 126.8 points to the FTSE-100 Index.

It now stands at 5529.1.

The rise is being led by Cable & Wireless, now up 10% after announcing a £4 billion deal to sell its 52.5% stake in Optus, Australia's second largest telecommunications company, to Singapore Telecom.

Its shares are up 43½p at 487½p.

Vodafone, whose Pacific subsidiary pulled out of the running for Optus, has also risen, up 9¼p at 203½p.

Other telecom stocks on the up include Colt, ahead 53p at 883p, Telewest up 7½p at 124½p, and Energis, 14p stronger at 308p.

A number of tech stocks are joining the revival, including Logica, up 77p at £11.53, and Dimension Data, 17½p stronger at 327½p.

Banks are also helping pull the market higher, with Standard Chartered up 37p at 812p, Barclays ahead 75p at £19.71, Royal Bank of Scotland up 67p at £14.12, HSBC up 20½p at 819½p and Lloyds TSB 12p stronger at 651p.

With techs and telecoms back in favour for the time being, old economy stocks are suffering.

Casualties include tobacco group BAT, off 20p at 509½p, BAE Systems down 2½p at 325p and Scottish and Southern Energy, off 9½p at 611½p.

Brewers Scottish & Newcastle and Bass are off 2½p and 7p at 523½p and 643p respectively.

Fashion retailer New Look has seen its shares slumped 18%, or 11p, to 50p announcing that sales had been "weaker than expected".

Electronic goods designer Vtech's shares have dived 42% - off 20p at 27½p - after saying it expected to report a substantial full-year loss - hit by its telecoms business which had suffered substantial losses.

However, Forth Ports are up 3p at 699p after saying profits were ahead 25% last year.

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