Insurers get FTSE back on track

The FTSE 100 Index was back on track today as insurers helped it claw back some of yesterday’s heavy losses.

Despite a stuttering start, the top flight index managed to close 18.3 points higher at 4824.3, with markets across the Atlantic adding extra momentum.

The improvement was driven by insurers after a broker raised its price targets on firms in the sector yesterday and bid speculation continued to swirl around general insurer Royal & Sun Alliance.

R&SA was more than 2% or 2.25p stronger at 83.25p while Prudential cheered 7.25p to 464p, Legal & General lifted 3.5p to 116.25p and Friends Provident picked up 4p to 163p.

Banks were carried along by the positive sentiment towards insurers with Northern Rock 9p higher at 786.5p and Lloyds TSB rising 2.5p to 475p.

But the Footsie was led by British Airways as investors piled into the stock after figures showed a total of 2.73 million travellers flew with the airline in December 2004 – 1.8% more than in December 2003. Shares rose 5%, up 11.5p to 242.5p.

It was followed by Rolls-Royce, up 3% or 8p at 251p after a positive broker note on the company.

Aerospace industry counterpart BAE Systems rose 6p to 230.5p.

The highest Footsie risers were British Airways up 11.5p to 242.5p, Rolls-Royce adding 8p to 251p, Legal & General up 3.5p to 116.25p and BAE Systems adding 6p to 230.5p.

The heaviest fallers were ICI off 4.25p to 231p, Scottish & Southern Energy falling 13p to 867p, Standard Chartered off 14p to 956.5p and Gallaher falling 10p to 785p.