FTSE continues winning run through 5600 barrier
Investors paused for breath after the rally seen at the end of last week, but the top tier held above the 5600 level – closing up 6.96 points at 5606.72.
It was also a more stable day for America's Dow Jones Industrial Average in the absence of any major economic or corporate news.
The Dow clung to its opening mark after last Friday's 1 per cent advance following better-than-expected US unemployment figures and a wave of mergers and acquisition news.
There was more takeover news yesterday, again from embattled US insurer AIG as it struck a deal to sell off its major foreign divisions to MetLife for 15.5 billion US dollars (10.3bn).
AIG's shares rose 3.5 per cent to $29.07 after the company agreed to sell its Alico foreign life insurance unit to MetLife. MetLife's stock shot up 4 per cent to $40.49.
McDonald's advanced 2.6 per cent to $65.30 after the world's biggest hamburger chain, a Dow component, reported that February same-store sales increased 4.8 per cent.
"I think it bodes well for the rest of the week that we're able to hang in after all these gains," said Stephen Massocca, managing director of Wedbush Morgan in San Francisco.
But with few other announcements being made, the UK market was setting its sights on a raft of economic reports toward the end of the week, including the latest retail sales and consumer sentiment reports.
Meanwhile the pound fell to 1.50 against the US dollar and 1.11 against the euro as economic and political uncertainty continued to impact sterling – although the currency has so far staved off the full-blown collapse threatened early last week.
One of the top tier's biggest risers was oil firm Petrofac, which gained 4 per cent after a 33 per cent increase in net profits for 2009 was well received. Shares rose 44p to stand at 1116p.
Insurer Prudential eased back from early session advances after it said it hedged the dollar cost of the deal to protect itself from a falling pound. The firm, which was on the back foot last week after unveiling a mega-deal to buy stricken AIG's Asian arm, closed 2p lower at 518p as it also said it planned to launch on the Hong Kong stock exchange before launching a rights issue to fund the takeover – a move that would allow it to widen the cash-call to Asian investors.
Fellow insurer Legal & General added 2p to 781/4p.
The star of the FTSE 250 was Forth Ports – the UK's biggest listed ports operator – which saw shares surge 26 per cent, or 286p, to close at 1403p after the firm revealed a 612m takeover approach by a group of major shareholders.
Forth, which owns seven UK ports, including Tilbury in London, Scotland's largest container port at Grangemouth, and Leith in Edinburgh, rejected an improved 1340p a share proposal from the consortium and said the price "fell far short" of the value of the business.
Also in the second tier, Bovis Homes returned to profit with a 4.8m surplus for 2009. The result saw shares lift 73/8p to 3883/4p. Bovis said its strategy this year would see it invest in new land in order to generate "strong future returns".
The biggest Footsie risers of the session were Resolution up 33/8p to 721/8p, Petrofac, Home Retail Group lifted 87/8p to 2675/8p and Legal & General.
The four biggest Footsie fallers were Amec down 15p to 7681/2p, British Airways off 4p to 2241/4p, Intertek slipped 22p to 1324p and Randgold Resources, which closed 75p down at 5080p.