Plans by water supplier Severn Trent to spin off its Biffa waste management business kept the FTSE 100 Index above the 6000 mark today.
Shares in Severn Trent rose 6% or 71p to 1197p as investors took the decision to demerge Biffa as a sign that the company was getting back to basics following a recent rocky run.
But losses in the oil sector meant the Footsie followed the example of markets across Europe by closing in the red – off 19.6 points to 6004.7 at the end of trading.
The strong performance by Severn Trent encouraged buying in a number of other utility stocks with Scottish Power up 7p at 585p in the top flight and second-tier Anglian Water Group ahead 12p at 1152p, a rise of 1%.
There was also a rise of 1p to 237p for Northumbrian Water while South West Water owner Pennon Group surged 2% or 31p to 1354p, as investors noted the fact that it also owned waste management business Viridor.
Miners were higher as copper specialist Kazakhmys continued to benefit from strong results last week. It rose 6% or 64.5p to 1181p – a sharp contrast with the opening price of 976.5p on Monday of last week.
Elsewhere in the top flight, BAE Systems jumped 4% – up 15.5p to 439.25p - amid signs that a Saudi deal to buy Eurofighter planes remained on course. Analysts also calculated the potential financial benefits from the company’s expected role in the consolidation of the UK shipbuilding industry.
The fallers board was led by Tate & Lyle as sentiment towards the sugar group remained weak following its recent decision to write down the value of its assets. The stock was 2% lower, a fall of 11p to 564.5p.
Oil firms were ignored after crude futures fell below $65. BP was hit hard by profit takers, losing 10p to 664.5p compared to Royal Dutch Shell which declined 8p to 1886p.
Meanwhile, record profits of more than £20m (€28.6m) from publisher Bloomsbury failed to inspire its share price – down 20.25p at 342.75p – as the company had already flagged up the Harry Potter-related boost. Analysts said the decline of 6% reflected profit taking following a recent strong run.
There was a better performance from retailer Topps Tiles after the company issued a trading update offering some encouragement to investors. With like-for-like sales up 0.9% in the past five weeks, Topps shares gained 5% or 11.75p to 232.75p.
Meanwhile, Virgin Mobile shares rose 4.5p to 391.5p as details of the takeover by NTL finally emerged after weeks of speculation.
The biggest Footsie risers were Severn Trent up 71p at 1197p, Kazakhmys up 64.5p at 1181p, BAE Systems up 15.5p at 439.25p and Rentokil Initial up 3p at 159.25p.
The biggest fallers were Tate & Lyle down 11p at 564.5p, PartyGaming down 2.25p at 131.75p, Cadbury Schweppes down 9p at 564p and Brambles Industries down 6.75p to 428.75p.