FTSE inches up

Northern Rock shares hit a new low today as speculation over the ailing banking group's prospects continued to darken.

The Newcastle-based business saw its shares touch 144.5p, valuing the company at around £609m (€873m) - a decade to the day from the former mutual's debut as a publicly-listed company.

It was later 16% or 28.9p lower at 150.3p, during an uncertain session for the wider London market.

Traders appeared to be hanging on for economic news in the United States and the UK later in the week, although the Footsie did still manage to post a gain of 23.1 points to 6489.9 by 11:15am this morning.

For Northern Rock, shares fell after analysts predicted the mortgage lender would slump to losses of more than £100m (€143.34m) next year. It is also facing the prospect of a cut-price takeover, with potential buyers including hedge funds Cerberus and JC Flowers.

Meanwhile, Tate & Lyle began its fight for top flight survival after shares dived on Friday following the latest profits warning from the sugars group.

The stock, which is in danger of being relegated from the FTSE 100 Index for the first time, rose more than 6%, or 25.75p to 428.25p - a small slice of the 28% decline seen at the end of last week.

Investec Securities said the current share price failed to take into account the positive catalysts of management change or a takeover attempt.

There was also a recovery for housebuilders, with Persimmon up 37p to 1001p, Barratt Developments ahead 9p at 757p and Taylor Wimpey 3.5p stronger at 279.25p.

Meanwhile, Trinity Mirror shares gained after it sold the Racing Post for £170m (€244.24m) and said it would keep hold of newspapers in the Midlands and some in the South East. Shares shook off an uncertain start to rise 1p to 413p.

Transport group First Group stepped up a gear, ahead 2% or 12p at 700.5p, after the company issued a positive trading update.