Footsie hold onto positive territory

London’s FTSE 100 Index held on to positive territory by a narrow margin today after giving back nearly all of the gains seen earlier in the session.

At one point the Footsie rose by 40 points but weakened in line with a tepid start to trading on Wall Street, eventually closing 2.4 points higher at 4225.9.

The market now appears to have found its level as the Footsie closed slightly lower than it had started the week.

Analysts said the mood in London remained strong but that confidence would be more severely tested next week by a greater number of company results.

Volumes today were predictably light as traders wound down to the Bank Holiday weekend and faced little in the way of corporate and economic news.

WPP proved to be one of the most watched stocks as it recovered earlier losses to close 8.75p higher at 578.75p.

Despite reporting lower revenues and profits in the first half, investors were cheered by comments from the advertising industry leader over brighter prospects for next year. A 20% dividend rise also helped.

The performance provided a boost to other media stocks with Reuters ahead 7p to 267p and Financial Times owner Pearson 3.25p stronger at 628.5p.

Granada and Carlton Communications also rose sharply as the ITV pair benefited from speculation that their merger could avoid a condition from the Competition Commission to sell their advertising houses.

FTSE 250 Index company Carlton cheered 10.75p to 186.75p while its merger partner added 5.5p to 110.25p.

Granada was only denied a place at the top of the Footsie risers board by gases group BOC which surged more than 5%, or 46.5p to 889.5p, on the back of upbeat comments from chipmaker Intel. BOC is major supplier to the sector.

The same update also cheered chip specialist and former blue-chip company ARM Holdings, which rose 7p to 107p in the FTSE 250 Index.

Engineering group GKN was another strong riser after agreeing to sell its 29% stake in armoured vehicle maker Alvis to BAE Systems. GKN lifted 3% or 8.25p to 259.25p while BAE rose 3.5p to 169.75p and Alvis added 25p to 219.5p.

Elsewhere, mobile phone firms were out of favour with Vodafone falling 1.5p to 118.25p while mmO2 led the fallers board with a 1.5p drop to 53.5p.

Outside the Footsie, construction services group Keller lost earlier gains to stand 1.5p lower at 248.5p after failing to meet ambitious growth targets in the first half.

But the company did look to reassure investors by saying it remained confident of achieving strong annual growth.

Energy group International Power slipped almost 2% or 3.75p to 150.75p as Anglo-Australian mining group BHP Billiton tabled an offer trumping its bid for Drax, the UK’s biggest power station in North Yorkshire.

The biggest Footsie risers were BOC up 46.5p at 889.5p, Granada ahead 5.5p at 110.25p, Rolls-Royce up 7.5p at 163p, GKN ahead 8.25p at 259.25p.

The biggest fallers were mmO2 down 1.5p at 53.5p, Reckitt Benckiser off 21p at 1130p, Aviva down 9.25p at 520p and BAA off 8p at 466p.