FTSE hits two-month high

A positive reaction to one of the biggest days in the corporate calendar ensured the London market rose to a new two-month high today.

Rolls-Royce, Smith & Nephew and Royal Dutch Shell were among heavyweights on the front foot after strong results performances.

That meant the FTSE 100 Index was able to extend its winning run in the week so far to reach mid-morning at 5914.2, a gain of 37.3 points or 0.6%.

Shares in the Anglo-Dutch company lifted more than 2% as investors welcomed a 36% hike in second-quarter earnings of $6.3bn (€4.9bn), or £1.6m (€2.4m) an hour.

Shell was boosted by record oil prices, which have been pushed higher by political tensions in the Middle East. Shares in Shell gained 53p to 1993p today while rival BP, which posted figures on Tuesday, was up 12.5p to 647p.

Rolls-Royce followed suit after lifting its half-year dividend by 10% in the wake of a 12% rise in underlying profits. With the company’s order book also increasing to £25.1bn (€36.7bn), shares were 24.25p higher at 445.75p.

Medical devices group Smith & Nephew was stronger, up 16.25p at 448.25p, after reconfirming full-year guidance with a first-half rise in profits to $141m (€206m).

B&Q owner Kingfisher leapt towards the top of the blue-chip leaderboard with a gain of 8p to 242.5p, or 3%, after it raised hopes of a long-awaited sales revival.

British Gas owner Centrica ticked 4p higher to 296.5p as investors weighed up the impact of today’s 12.4% increases in household gas bills.

But there was bad news for investors in music firm EMI Group, which sank almost 3% or 6.75p to 255p after it shelved plans to pursue a £1.35bn (€2bn) takeover of US counterpart Warner Music.

Bradford & Bingley was another second-tier faller, off 14.75p at 448p, after revealing it would take an additional £89.4m (€130.6m) charge to cover claims for the previous mis-selling of endowment and investment products.