FTSE shows modest rise despite takeover talks

Takeover talk lifted several London stocks today although the bid rumours sweeping the market failed to lift the Footsie into positive territory.

Takeover talk lifted several London stocks today although the bid rumours sweeping the market failed to lift the Footsie into positive territory.

Dulux paints firm ICI was among the gainers today as a number of London shares found themselves at the centre of bid attention.

Despite the excitement the FTSE 100 Index eased 5.5 points to 6360.6 during mid-morning trading.

As well as ICI, Durex-to-Scholl group SSL International was up nearly 9% and Taylor Woodrow lifted 2% on hopes of a deal to rival its tie-up with George Wimpey.

Attention was again focused on ICI following its rise of 7% last night, when traders digested rumours of a potential £7.4 billion bid from US firm Dow Chemicals. Shares were ahead 7.25p at 547p today.

But Argos owner Home Retail Group topped the early risers, up more than 3%, or 14p, at 463p, as the stock benefited from an upgrade by Citigroup.

Companies turning ex-dividend, meaning the buyer of the shares is not entitled to the latest dividend payment, accounted for four of the top five blue-chip fallers. Pearson was off 26p at 856p, Alliance & Leicester down 32p at 1123p, Hanson off 14p at 815.5p and Kingfisher down 4.5p at 278p.

In the second tier, housebuilders rose amid renewed hopes of fresh consolidation activity. Merrill Lynch sparked the latest wave of action as it said there was a strong possibility that Persimmon will counterbid for Woodrow, which stood 9.75p higher at 503p. Bovis Homes lifted 27p to 1194p.

Shares in SSL, often linked with a potential bid from consumer products rivals or private equity, was up 9% with a gain of 34.25p to 434p, easing back from a gain of 13% earlier in the day.

Waste disposal group Biffa moved in the opposite direction – down 20.25p at 331p – after warning that profits would be towards the lower end of market expectations.

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