FTSE holds firm

The London market held firm today as investor confidence rebounded following Friday’s heavy losses.

The FTSE 100 Index was 15.8 points higher at 6207, with commodity stocks adding their weight to blue-chips.

The benchmark index declined by more than 1% on Friday after employment statistics in the United States raised recession fears for the world’s largest economy.

Traders in Japan reacted to the US payroll numbers earlier today, but the 2% decline for the Nikkei failed to spark a new wave of selling in Europe.

On the corporate front, Sainsbury’s shares were higher after a newspaper report said Qatar-backed fund Delta Two intended to increase the cash element of its £10.6 billion bid for the supermarket chain. The stock rose 5.5p to 552.5p.

Broker upgrades lifted the mining sector, with Kazakhmys up 25p at 1314p and Lonmin 40p higher at 3332p, while oil giant Royal Dutch Shell gained 17p to 1980p even as oil prices eased. BP was 2.5p ahead at 562.5p.

Kingsmill bread owner Associated British Foods topped the Footsie fallers board after it said the rising cost of wheat would continue to put pressure on its bakeries division. Meanwhile, the firm warned that increased competition and heavy markdowns at clothing chain Primark would impact margins, offsetting further recent sales growth. The stock slid 3%, or 276p to 811p.

Utility groups Kelda and United Utilities were both on the front foot amid speculation over consolidation in the water sector. Kelda gained 11.5p to 850.5p and United Utilities was 6p higher at 670p.

The biggest gain in the FTSE 250 Index came from Sports Direct International, up by 6% after a trading update quelled fears over the need for analysts to consider more profits downgrades. The retailer was 8.25p higher at 144.25p.