Property props up FTSE

A return to form for mortgage lenders and housebuilders helped keep the FTSE 100 Index in positive territory today.

Northern Rock took centre stage on the London market once again, up 8% or 14.5p at 195.6p as fresh takeover speculation emerged.

The wider Footsie was up 49.3 points at 6482.3 as financial stocks steamed ahead.

Crisis-hit mortgage lender Northern Rock headed the risers board after reports that private equity firms JC Flowers and Cerberus had been given access to its books.

The bank was followed by Alliance & Leicester, up 51p at 784p, while fellow lender Halifax Bank of Scotland rose 37p to 910p.

Housebuilders also made a strong showing on the list of top share risers after an upbeat note from Citi analysts on Barratt Developments, which helped reassure after Barratt’s comments yesterday about the effect of the Northern Rock crisis on sales.

Barratt rose 30.5p to 756.5p, Persimmon saw a 48p hike to 958p and Taylor Wimpey gained 16p to 274p.

Meanwhile British Airways shares took off after news it had placed its largest order for new planes for nearly 10 years.

Shares soared by 4%, or 13.5p to 382.5p. Rolls-Royce, which will power the 12 Airbus 380s and 24 Boeing 787 Dreamliners on order, also felt the benefit, up 8p at 529p.

Among the fallers, pubs chain Mitchells & Butlers fell 1p to 617p despite an update predicting results at the upper end of expectations.

Insurer Resolution also dipped 10p to 685p on reports that rival Pearl could launch an all-cash bid at a discount to the current share price, possibly scuppering Resolution’s planned merger with Friends Provident.

Smiths Group was off 10p at 1085p after hopes faded of a possible break-up of the business amid yesterday’s news of a change at the top for the firm.