FTSE close to two-year high

The FTSE 100 Index was in touching distance of last month’s two-year high today after George Bush moved closer to victory in the US presidential election.

Although it dipped back slightly from its opening mark, the Footsie stood 18.9 points higher at 4712.2 by mid-morning, taking the index close to last month’s peak of 4732.9.

Progress was held back by concerns that the outcome may not be confirmed for several days, with Democratic challenger John Kerry refusing to concede defeat.

Insurers and pharmaceutical stocks made significant gains as investors cheered the prospect of a Bush victory, which many see as positive for big businesses.

The highest climber was drugs company AstraZeneca, nearly 2% higher after rising 42p to 2299p. GlaxoSmithKline was also in upbeat form, cheering 12p to 1182p.

Insurer Royal & Sun Alliance was another big riser, adding 1.25p to 77.5p, while Prudential lifted 5.5p to 415.5p and Legal & General advanced 1.25p to 103.25p. Insurers would prefer a Bush victory as Republicans favour legal reform, including asbestos litigation and class-action lawsuits.

A lift in the price of a barrel of crude oil back above the $50 level boosted oil giants BP and Shell, up 2p and 3.25p to 534.5p and 431p respectively.

Most corporate news today was coming from outside the top flight, with bus and rail operator FirstGroup 5% higher – up 13.5p to 302p – as it turned in a 9% rise in half-year profits to £62.1m (€89.8m).

Shares in glass maker Pilkington rose 5%, up 4.75p to 94.5p, after a surprise increase in profits was accompanied by an upbeat assessment on prospects.

Robert Wiseman Dairies lifted 11.5p to 236.5p after reporting a 12.2% increase in profits, although it said higher raw material prices would cost it more than £1m (€1.45m) in the second half.

But Carphone Warehouse weakened 8p to 159p despite posting profits ahead of expectations as it said it was benefiting from a “buoyant” mobile market.