FTSE in positive territory

Stocks caught in a heavy sell-off in London yesterday rallied to prevent the FTSE 100 Index sustaining more heavy losses today.

Oil giant BP was among those to recover, gaining more than 1% as the Footsie reached mid-morning 25.4 points higher at 4338.5.

BP’s rise of 8.5p to 642.5p was matched by Royal Dutch Shell, which cheered 13p to 1878p as both stocks attracted buying interest after falling in the wake of lower oil prices earlier in the week.

The London market was also helped by a positive trading statement from banking giant HSBC – up 4.5p to 930.5p after revealing that pre-tax profits in the third quarter were above last year across all parts of its business.

Analysts were relieved that HSBC had avoided the disappointment of Barclays earlier in the week, while the statement also helped to steady the nerves of investors who have flinched at higher costs and bad debts. Alliance & Leicester rose 6.5p to 898.5p while Royal Bank of Scotland cheered 9p to 1659p.

Insurers were also positive, although Prudential proved the exception after its offer to buy out fellow investors in online bank Egg.

Shares in the Pru fell 2% or 8p to 519.5p as shareholders saw their hopes of a return of cash from any sale of Egg disappear, making the insurer one of the session’s heaviest fallers.

Major movers outside the top flight included Egg – up 13% or 13.5p to 116p - as its shares reflected the premium that the Pru is willing to pay for total control.

Furniture retailer MFI lost hold of an initial 7% gain to stand unchanged at 74.75p after slowing the rate of decline in orders at its UK retail chain and staying on course to post annual results in line with expectations.