Shares march on in London

Shares in London continued their forward march today boosted by renewed takeover speculation surrounding insurance giant Prudential.

The Pru lifted 2% as rumours of a renewed bid by Norwich Union owner Aviva swept the City, although analysts said such a move was unlikely.

The excitement spread to other insurance stocks and helped the FTSE 100 Index overcome losses by steel maker Corus to stand 22 points higher at 5910.3 by mid-morning.

The London market also benefited from gains on Wall Street overnight after comments from the Federal Reserve were interpreted as a sign that interest rates in the US were likely to remain on hold.

Shares in the Pru were up 11.5p to 590p on the back of the takeover rumours, and it was followed up the leaderboard by Legal & General, which gained 2.5p to 133.75p, and Friends Provident, which was 2p higher at 185.75p.

Pubs owner Enterprise Inns was also on the move after Deutsche Bank lifted its price target from 1060p to 1200p and reiterated its buy rating. Shares in Enterprise were 23p higher at 1017p.

However, shares in steel maker Corus slipped into the red today after its first half results disappointed investors.

The Anglo-Dutch giant slipped 2% or 6.5p to 394p after it posted a 37% fall in operating profits and warned of higher raw material and energy costs.

Outside the top flight, regional newspaper publisher Johnston Press gained 14.25p to 396.75p despite a “sustained downturn” in advertising revenues which saw pre-tax profits fall 3% in the first half. Investors instead concentrated on its chances for the full year which remained encouraging.