FTSE looking good for record-high

A string of broker upgrades helped put the FTSE 100 Index on course to set another three-year high today.

A string of broker upgrades helped put the FTSE 100 Index on course to set another three-year high today.

Positive comments on the likes of Associated British Foods, Rentokil Initial and British American Tobacco contributed to the Footsie moving 11.8 points higher to 5084 by mid-morning.

This took it above Friday’s highest closing point in three years of 5077.6.

Silver Spoon sugar owner AB Foods was the best blue-chip performer – rising nearly 3% or 22p to 810p – as Merrill Lynch upgraded the company to “buy” from “neutral”.

Rentokil was not far behind, rising 2.5p to 159p as a broker said a restructuring sanctioned by the High Court would enhance value to shareholders and potential bidders.

BAT cheered 8p to 1068p after SG Securities reiterated its buy rating on the firm and increased its target share price to 1170p.

Sky-high oil prices were also in focus as the cost of a barrel of US light crude hovered just below yesterday’s record high, at $59.30.

Supermarket group Morrisons initially moved higher as investors reacted positively to the appointments of three non-executive directors last night – but later fell back to stand unchanged at 178p.

Among companies reporting today, Alliance & Leicester fell a penny to 864p despite giving the industry some respite from worries over bad debts by saying arrears on mortgages and other loans remained at low levels.

Media group Emap was 1.5p lower at 798p after saying it had agreed a £391m (€588.5m) deal to take over Scottish Radio Holdings.

Rival Gcap Media – the company formed out of Classic FM owner GWR and Capital - lost nearly 5%, down 14p to 268p, as it revealed revenues fell 14% in May.

Elsewhere, engineering group WS Atkins was also in the red as it posted a 31% rise in annual profits but warned of a slowdown in its key rail market. The stock weakened 17.5p to 669.5p.

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