Cadbury results sweeten FTSE despite salmonella scare

The FTSE 100 Index made up for losses earlier in the week today as it moved into positive territory, sweetened by strong gains by Cadbury Schweppes and ITV.

The London market plunged into the red last night amid further inflationary concerns in the US, but with New York on the front foot and buoyed by positive corporate data, the Footsie closed 51.3 points ahead at 5932.1.

Cadbury gained 16.5p to 537.5p after reporting a 24% hike in group pre-tax profits to £402m (€589.6m) for the first half of the year.

Investors welcomed the news despite the company saying the high-profile salmonella scare that hit the firm in June was likely to cost it £20m (€29.3m) following the recall of one million chocolate bars.

Broadcaster ITV raced to the top of leaderboard amid renewed speculation over a private-equity bid and talk chief executive Charles Allen is close to stepping down. Shares were up 4.5p or almost 5% at 101.5p.

Property company Hammerson also moved forward, lifting 34p to 1274p, after it announced the acquisition of a portfolio of warehouses from LxB Holdings for £425m (€623.5m).

However, pharmaceuticals firm GlaxoSmithKline found itself going in the other direction following a US court ruling that could open the door to a generic version of its antidepressant pill Wellbutrin XL.

The stock dropped almost 2%, or 26p, to 1434p.

Despite banking half-year profits of £1.78bn (€2.6bn), Lloyds TSB also traded in negative territory, down 6p to 528p, after it reported higher-than-expected bad debt levels today.

This bucked the trend across the banking sector as investors cheered bumper profits. HSBC gained 10p to 970p after boosting its first-half profits 18% to £6.7bn (€9.8bn) earlier in the week.

Halifax Bank of Scotland also found itself on the way up, buoyed by yesterday’s announcement of a 17% rise in half-year profits. Shares lifted 16.5p to 989p. Barclays was 3.5p up at 627.5p ahead of its figures tomorrow.

Outside the top flight, car and bicycle parts specialist Halfords rose 11.25p to 307p after it reported a 9.5% lift in total sales in the 17 weeks to Friday, while like-for-like sales when including the impact of a later Easter were ahead 6.6%.

This is slower than the rate of 7.3% reported in June, but shares still rose by almost 4% as analysts said Halfords had done well to offset the negative impact of the World Cup and the hot summer weather.

London-based engineering group Tomkins, which sells parts for car engines and air conditioners, slipped 6%, or 17.5p, to 266.75p after earnings came in at the lower end of analyst forecasts.

The day’s biggest blue-chip risers were ITV up 4.5p to 101.5p, Partygaming up 3.75p to 109.5p, BHP Billiton up 32p to 1025p and Cadbury Schweppes up 16.5p to 537.5p.

The day’s biggest blue-chip fallers were Corus group down 12.75p to 415p, GlaxoSmithKline off 26p to 1434p, Lonmin down 47p to 2816 and Lloyds down 6p to 528p.