FTSE on the rise

The FTSE 100 Index enjoyed its second winning session in a row today as news of a £5bn (€6.3bn) takeover move in the mining sector helped boost blue chips.

Platinum firm Lonmin soared 48% higher after an unsolicited takeover approach from Xstrata, which added to higher gold prices to buoy fellow mining stocks.

Heavily weighted oil majors were also advancing after yesterday’s falls, which helped the Footsie lift 31.6 points to 5486.1.

The gains came on top of the 2.5% rally seen the previous session after oil prices fell to US$118 a barrel. Oil fell further again today after the close on news of an unexpected rise in crude supplies.

Lonmin was the top share riser, up 1107p at 3426p following Xstrata’s interest, labelled “unwelcome” by the target.

But it was a a poor session for media, insurance and property firms, with the mood soured by half-year results and a gloomy outlook statement from commercial broadcaster ITV.

Shares in the firm were 6% lower, down 2.7p at 43.6p, after a 28% fall in half-year profits. ITV also cut its dividend by 50% and forecast a deterioration in advertising revenues for the rest of 2008.

The impact was felt in the FTSE 250 Index, with Trinity Mirror down 9% or 12.25p at 122p and directories firm Yell 2p lower at 89.75p, although Johnston Press proved the exception after a broker upgrade for the beleaguered stock lifted shares 6p to 60p.

Back in the top flight, Old Mutual shares fell more than 11% or 12.1p to 94.3p after South Africa’s largest insurer blamed volatile equity markets for increased provisions, offsetting a 3% rise in operating profits. The firm was the Footsie’s worst performer.

Financials were also hit by news from across the Atlantic of worse than expected numbers from struggling US mortgage giant Freddie Mac.

Lloyds TSB was down 10.25p at 314.25 as banks gave back some of yesterday’s gains.

Standard Life was also under pressure, despite reporting a 51% rise in half-year profits and increasing its dividend payment by 7%. Shares fell 1p to 243.25p during a difficult session for the insurance sector, with Aviva down 13p lower at 518.5p.

Property firms featured prominently on the fallers’ board after Liberty International reported a further 7.4% fall in its investment property values during the first half of 2008.

Liberty, which slipped 70p to 900p, warned of further falls to come until stability returns to the banking system, and said underlying profits had declined from £69m (€87.2m) to £57m (€72m) in the first half.

Rivals impacted included Hammerson off 28p at 989p and British Land down 21.5p at 737.

Department store chain Debenhams was enjoying better fortunes as market rumours of a possible takeover bid from Icelandic investment group Baugur continued to swirl, lifting the group almost 16%, or 7.75p to 57.5p.

The biggest Footsie risers were Lonmin up 1107p at 3426p, Johnson Matthey ahead 107p at 1616p, Eurasian Natural Resources up 67p at 1017p and London Stock Exchange up 30p at 920p.

The biggest Footsie fallers were Old Mutual down 12.1p at 94.3p, Liberty International off 70p at 900p, ITV down 2.7p at 43.6p and Lloyds TSB down 10.25p at 314.25p.