The FTSE 100 Index closed just shy of the key 6000 barrier today as strong gains from banks put the market on the front foot.

Takeover speculation and hopes of a dividend hike from Royal Bank of Scotland caused shares in the financial sector to surge today.

Lloyds TSB shares rose 4% today after the smallest of the “big-five” banks revealed in-line pre-tax profits of £3.9 billion for 2007.

Waste collection and recycling firm Biffa agreed to be taken over today in a private equity deal valuing the company at more than £1.2bn (€1.61).