Northern Rock climbs back

Crisis-hit Northern Rock’s roller-coaster ride on the markets continued today as the mortgage lender’s shares gained 6%.

The company was 10.9p higher at 196.1p – around the level of rumoured bids for the group – making up some of the ground lost in its 28% slump yesterday.

Buoyant commodities prices and broker upgrades helped the wider FTSE 100 Index gain 37.9 points to 6466.9 by mid-morning.

Joining Northern Rock among the risers were a host of energy stocks. The sector was fired by oil prices which hit a record high for the fourth straight session on Thursday, before easing back overnight.

British Energy was up 26p at 514.5p as traders anticipated the benefits of higher fuel costs. BG Group lifted 9.5p to 857p, and oil giant BP rose 6.5p to 597p.

Cruise giant Carnival sailed 70p higher to 2444p after positive results yesterday and a confident note from brokers at Evolution, while Citigroup talked up pharmaceuticals firm Shire’s portfolio of new products, sending the shares 25p ahead to 1181p.

Meanwhile insurer Prudential was 12p up at 697.5p as investors reacted positively to news that the company had gained a new financial chief from rival Aviva.

But B&Q owner Kingfisher was the biggest loser of the session on the back of broker downgrades after its interim results on Thursday disappointed investors. The stock lost 3.8p to 177.2p, while Homebase owner Home Retail Group also suffered – down 3.5p at 370.25p.

Housebuilder Barratt Developments was off 11.5p at 780.5p as tighter credit conditions and falling consumer confidence fuelled fears of stagnation in the UK housing market.

Despite Northern Rock’s strong gains, Alliance & Leicester was off 5.5p at 750p as the lender announced higher rates on tracker mortgages following the credit crunch in global markets.