London shares power ahead

London shares powered ahead today after a strong rally on Wall Street before the weekend lifted confidence.

Blue-chip heavyweights such as Vodafone and BP moved ahead and helped the FTSE 100 Index race up 65.1 points to 4116.2 by mid-morning.

The Footsie’s bright start followed a strong showing on US markets on Friday when the Dow Jones Industrial Average shook off poor earnings and economic figures to rally 1.5%.

In addition expectations Wall Street will continue to make gains this afternoon helped boost shares in the City.

Telecoms were among the pacesetters with Vodafone up 4%, or 3.75p at 106.75p, mmO2 up 2.25p at 52.5p and BT up 5.25p at 189.75p.

And banks were on the rise with Barclays up 16p at 453.75p, Lloyds TSB ahead 13p at 572.5p and Royal Bank of Scotland climbing 30p to £15.57.

Oil giant BP also added weight to the market, up 5.5p at 432p ahead of its third-quarter update tomorrow while Shell, which reports on Thursday, was 3.75p higher at 407p.

Elsewhere supermarket chain Safeway climbed 5%, or 9.5p to 220.75p, on reports Royal Bank of Scotland was part of a consortium looking at bidding and breaking up the troubled group.

Drugs giant AstraZeneca was another riser, up 2%, or 50p at 2415p, after tests showed one of its new treatments cut the risk of blood clots after knee and hip replacements.

It came after a tricky weekend for the group when it was forced to defend its new cancer treatment Iressa after it emerged dozens of patients had died from side effects.

And tour operator First Choice rose a penny to 115p after it lifted the gloom in the sector by signalling it was on course to meet full-year expectations.

But rival MyTravel continued to slide, off 9%, following reports on the weekend raising further concerns about its financial health.

A number of reports said the group would start talks this week to break up and sell off parts of the business, as a buyer was unlikely to want to take on the whole of the troubled group.

Shares tumbled another 1.75p to 18.25p.