FTSE recovers from early losses

Shares in London rallied today after an early morning low but continued to trade in the red amid soaring oil prices and intensifying violence in the Middle East.

The FTSE 100 Index opened almost 50 points down following on from yesterday’s losses of nearly 100 but recovered enough to stand 3.1 points lower at 5761.9 by mid-morning.

It came as world markets were hit by record oil prices and fears over the fighting between Israel and Lebanon.

The Dow Jones Industrial Average sank 167 points overnight in New York while the Nikkei was down more than 250 points after the Bank of Japan raised interest rates for the first time in six years.

In London, oil giants BP and Royal Dutch Shell were among the stocks in positive territory as the price of crude rose above$78 a barrel boosting their earnings prospects. BP was 3.5p higher at 644.5p while Shell made gains of 8p to 1842p.

But much of the rest of the market was in retreat with miners tumbling due to fears record oil prices might yet cool economic activity. Rio Tinto was 52p to 2758p followed down by Antofagasta 7.75p lower at 421p and Kakazhmys – off 4p to 1203p – and BHP Billiton – down 13p to 1038p.

Broadcaster ITV topped the fallers’ board down 3p to 96.75p following speculation advertising bookings at its flagship channel ITV1 were down.

Second tier media group Emap gained 23.5p to 735.5p as investors bought back into the stock following its slump yesterday after it warned that underlying revenue may be down in the first half amid worsening trading conditions.

Also outside the top flight, catering equipment maker Enodis gained 9% or 17.75p to 216.5p as it considered a revised 220p a share takeover offer from Mantiowoc, which valued the firm at £892 million.