The FTSE 100 Index held firm in positive territory today, but it was a tough session for blue chip insurers Prudential and Admiral.
Pru suffered further losses, down another 6%, as the prospect of a £14 billion rights issue to pay for its Asian expansion weighed on sentiment.
The wider Footsie gained 33.7 points to 5439.7, with a strong showing from banks after HSBC concluded annual results from the “big four” yesterday.
Futures trading pointed to modest gains on Wall Street, after America’s Dow Jones Industrial Average closed more than 70 points ahead.
The pound, meanwhile, remained below 1.50 against the dollar, having fallen under the benchmark for the first time in 10 months yesterday due to concerns about the political outlook.
Among stocks, Pru fell 33.6p to 496.4p, after dropping 12% yesterday in the wake of the £23.5bn (€25.9bn) approach for the Asian division of stricken US insurer AIG.
Motor insurance group Admiral fell 2%, or 28p to 1237p, despite news of a 7% hike in annual profits.
However, investors are likely to have booked profits after strong gains for the group’s shares in recent weeks.
Another insurance major – Aviva – was in positive territory ahead of its annual results later this week. Shares lifted 5.9p to 381.1p.
Banks also littered the risers board as the sector’s reporting season draws to a close, despite HSBC’s lower than expected profits of $7.1bn (€5.2bn) yesterday.
HSBC recovered some of yesterday losses to stand 16p higher at 698p, with Asian-facing group Standard Chartered up 50p to 1575.5p, Lloyds Banking Group adding 1.55p to 51.81p and Royal Bank of Scotland up 1.17p at 37.86p.
Elsewhere, the strong start to the week for temporary power supply firm Aggreko continued after yesterday’s news that it had secured a major contract at this year’s FIFA World Cup. Shares rose another 28p to 1062p today.
Outside the top flight, Persimmon shares rose 22.7p to 423.3p after the housebuilder posted a return to the black in 2009 and said sales were up 7% since the start of the year. It is also looking for an improvement in its operating margin after an upturn in house prices.
But sub-prime lender Provident Financial dropped 5% in the FTSE 250, or 50p to 922p, as it said profits dropped by more than 2% in 2009 and gave a cautious outlook on customer appetite for borrowing in 2010.