Footsie up despite BA losses

The London market made strong gains today but shares in British Airways plummeted after an investigation was launched in the UK and US into alleged cartel activity.

The dive took the gloss of a positive session for the London market which saw the FTSE 100 Index lift 68.3 points to 5733.3 by mid-morning.

The Footsie was buoyed by rising commodity prices which sent mining stocks higher as well as strong performances by equities in the US and across Asia overnight.

But BA caused the biggest stir in the Square Mile after it emerged it and other airlines were under investigation by the Office of Fair Trading and US Department of Justice over the cost of air travel.

The company said commercial director Martin George and communications chief Iain Burns had been given leave of absence during the investigation and shares in BA slumped 6% or 22p to 349.75p.

There was better news for mining stocks which rallied strongly after the price of gold hit a one-week high and copper also rose.

It sent Footsie newcomer Vedanta Resources near the top of the blue-chip risers board with a gain of 44p to 1353p. It was followed up by BHP Billiton, which was 24p higher at 1026p, and Anglo American, which rose 72p to 2179p.

Outside the top flight, mortgage bank Bradford & Bingley lost 1.75p to 457.25p after it said it may take another charge to cover liabilities related to the mis-selling of endowment policies.

Going the other way, stock in capital works consultancy WS Atkins rose 7% or 51p to 824p after it posted a rise in annual profits and said its outlook remained positive as demand was strong in all its markets.

And fashion house Mulberry gained 11.5p to 196.5p after reporting profits had trebled to £6.2 million due to huge demand for its designer handbags sported by stars such as Kate Moss.