C&W upbeat after halting revenues slide

Telecoms stock Cable & Wireless led a surge for London shares today as investors set aside recent oil price jitters.

The stock rallied more than 6% after a positive update, helping the FTSE 100 Index stand 32.7 points higher at 4455.4 by lunchtime.

Investors were also cheered by a slight easing of oil prices below the $42 (€34.20) mark, following last night’s record high.

The FTSE’s gains were expected to be mirrored in New York, where the Dow Jones Industrial Average was tipped by analysts to open around 10 points higher.

Cable & Wireless set the positive tone in London with a rise of 7.5p (11.3c) to 129p (€1.94) after a major restructuring drive helped narrow annual losses.

Results from the telecoms group contained many plus points for investors, including the restoration of the dividend and an improving revenues performance.

Last night’s record oil prices lifted shares in BP and Shell higher, up 6.75p (10.1c) and 6p (9c) to 488.75p (€7.30) and 400.25p (€6.00) respectively.

Although the rising cost of crude exerted more pressure on British Airways, the stock shook off early losses to stand at its opening mark of 248p (€3.70) by lunchtime.

Financial stocks were among those helping lift the FTSE higher, led by Royal Bank of Scotland’s 28p (42.1c) rise to 1663p (€25.00). Barclays advanced 4.5p (6.8c) to 483p (€7.30), HBOS cheered 6.5p (9.8c) to 714.5p (€10.70) and Northern Rock gained 5.5p (8.3c) to 727p (€10.90).

But mining stocks were in the doldrums, with BHP Billiton the second heaviest faller – losing 6p (9c) to 458p (€6.90). It was followed by Anglo American off 5p (7.5c) to 1153p (€17.30), Xstrata losing 2p (3c) to 696p (€10.50) and Rio Tinto a penny weaker at 1314p (€19.80).

And the brakes were finally applied to the strong run by retailer Marks & Spencer in the wake of a potential £10bn (€15bn) takeover offer from billionaire Philip Green. Shares weakened 3p (4.5c) to 362.5p (€5.40) today.

Outside the top flight Northern Foods saw its shares rise 3.5p (5.3c) to 155.25p (€2.30) despite annual underlying profits falling 12% to £86m (€129.2m) after a “difficult and disappointing year”.

Discount fashion group Peacock advanced 10p (15c) to 218p (€3.30) after announcing it had bought perfume retailer The Fragrance Shop for more than £11m (€16.5m) and unveiling a 59.8% hike in pre-tax profits.

Utility AWG lifted 3.5p (5.3c) to 624.5p (€9.40) as it pledged to improve the performance of its unregulated infrastructure arm after ruling out a break-up of the group.