Vodafone and Sainsbury's boost FTSE

Mobile phone giant Vodafone and better-than-expected sales figures from supermarket chain Sainsbury’s helped steady the London market today.

The FTSE 100 Index initially lost 50 points from Tuesday’s 3% gain, but later recovered to stand 21.8 points lower at 5667.3 by mid-morning.

The resilient mood was helped by a 3% improvement for Vodafone amid reports that it expected to receive dividend payments from its 45% stake in US operator Verizon Wireless next year. Shares were 5p stronger at 156.9p.

Sainsbury’s topped the risers board after a fourth quarter like-for-like sales improvement of 4.1% bettered City hopes for an uplift of 3.7%.

The update countered fears that a resurgent Morrisons had eaten into market share, helping the stock recover recent weakness to stand 12p higher at 348.5p.

Xstrata provided the biggest decline after Brazilian mining firm Vale called off its takeover interest following the collapse of three-month long talks. Xstrata shares dived 8% or 298p to 3418p.

Other mining firms were on the front foot, with Kazakhmys ahead 60p at 1602p and Anglo American 102p higher at 2944p.

Insurance group Friends Provident was higher, up 1.2p at 124.7p, after the Financial Times said New York-based private equity firm JC Flowers remained interested in a takeover of the life assurer.

In the FTSE 250 Index, Debenhams tumbled 16% after traders said Merrill Lynch had been asked by an unnamed vendor to place 5% of its shares at between 60p and 66p each, compared with Tuesday night’s closing price of 71.5p.

Shares were down 11.5p at 60p.

Housebuilders were also under pressure after Bellway said reservations dipped 9% between August 1 and the middle of March. Bellway’s shares were off 18p at 792p, while Bovis Homes dipped 34p to 563.5p and blue-chip rival Persimmon fell 15.5p to 754.5p.