FTSE makes gains thanks to finance sector

A healthy showing from financial stocks offset continued jitters over retailers as the London market made steady progress today.

Insurer Standard Life topped the FTSE risers’ board, up 13.75p to 353.75p, with takeover speculation also helping to lift banks Lloyds TSB and HSBC.

The FTSE 100 Index gained 21 points to 6671.8 by mid-morning after a strong finish for Asia markets ensured the top flight recouped a large chunk of the losses seen yesterday.

Alongside positive sentiment over Standard Life, Lloyds was 8.5p higher at 583p on talk of interest from French bank Societe Generale, while HSBC added 10p to 935p on rumours of its interest in Greek bank Alpha Bank.

Other risers included Rolls-Royce – up 8p to 553p – on a host of contract wins announced at this week’s Paris air show.

But retailers were on the back foot with DSG International falling by more than 1% after the Currys owner posted a sharp fall in annual profits and said it would not be exercising an option to buy into Russian retailer Eldorado.

The stock was down 2.6p at 167.9p, even though DSG said its financial year had started well, with operations in Italy also showing signs of recovery following a troubled performance last year.

Supermarket chain Morrisons was off 4.25p at 297p after Sainsbury’s joined Tesco in warning of a more competitive trading environment.

But Sainsbury’s, which has been propped up by takeover speculation in recent days, saw shares rise 5p to 586p even though underlying like-for-like sales lifted 5.1%, below some analysts expectations of around 5.5%.

Tesco, which fell heavily on Tuesday after disappointing sales figures, was up 0.5p at 435p.

In the FTSE 250 Index, Tullow Oil continued to surge – up nearly 12% or 53.5p at 500.5p – as investors piled in following its major discovery off Ghana earlier this week.