FTSE slips slightly

Potential private equity bid excitement surrounding Marks & Spencer was today filling the void left by Sainsbury's, as the consortium eyeing the supermarket chain finally abandoned its takeover attempt.

M&S saw its shares leap 3%, or 20p, to 715p after an analyst highlighted the retailer's attraction, soaking up some of the disappointment after news that the Sainsbury's suitors, led by CVC Capital Partners, had abandoned their £10bn (€14.9bn) takeover plans.

The bid speculation failed to rally the FTSE 100 Index, however, which finished the day in negative territory, down 4.5 points at 6413.3.

Alliance Boots also benefited from the current heightened merger and acquisition activity, with its shares closing 1%, or 15p, up at 1050p, after yesterday's confirmation that private equity firm Terra Firma and medical charity The Wellcome Trust were considering making a play for the group.

Bid speculation elsewhere saw Scottish & Newcastle gain 3.5p to 598.5p and Scottish & Southern Energy rise 19p to 1597p, with the latter seen as the next target for consolidation in the power sector.

Fellow utility group Severn Trent rose on the back of a positive note from Morgan Stanley. Shares increased 15p to 1480p, while second-tier counterpart Northumbrian Water gained 8p to 329.25p as the note named the company as top pick in the water sector.

Mining giant Xstrata also helped the blue-chip index, as its shares rose 1% or 22p to 2779p after it sold its aluminium business to private equity group Apollo Management for a better-than-expected 1.15bn (€856m).

Supermarket Tesco was 0.5p higher at 456p on reports that it was considering a bid for Australian supermarket chain Coles, although it lost some of the gains made earlier in the day - up 3.5p at one stage.

Oil stocks were on the front foot following a recovery in oil prices, with Royal Dutch Shell advancing 8p to 1693p and BP up 5p at 559.5p, despite the continuing furore surrounding departing chief executive Lord Browne's "golden goodbye" package.

Stocks turning ex-dividend, meaning that investors will not receive the latest payout, saw insurer Friends Provident down 4.25p at 193.25p and property firm Hammerson off 25p at 1687p.

Miner Kazakhmys was the heaviest faller of the day, as one of the company's biggest shareholders sold his entire holding, causing shares to drop 46p to 1174p.

In the second tier, Woolworths was 0.75p higher at 30.5p after its biggest shareholder kept up pressure for "big changes" at the retailer, including a possible break up of the business.

Of companies reporting, magazine and book printing group St Ives was up 8p at 320p despite posting a fall in profits as it said it expected underlying trading to be "considerably ahead" over the year.

The biggest Footsie risers were Marks & Spencer up 20p at 715p, Alliance Boots ahead 15p at 1050p, Scottish & Southern Energy up 19p at 1597p and Alliance & Leicester ahead 12p at 1139p.

The biggest Footsie fallers were Kazakhmys off 46p at 1174p, Wolseley down 30p at 1244p, Sainsbury's off 12.5p at 526p and Carnival down 56p at 2388p.