London blue chips closed marginally higher yesterday as another foray above the key resistance level of 4,370 failed to hold.
The FTSE 100 closed 0.1 per cent higher at 4,352.3 with the mid- cap FTSE 250 0.2 per cent firmer at 5,823.7. Volume was a solid 3.1billion.
Allied Domecq led decliners with a fall of 4.2 per cent to 384-1/ 2p as the market reacted to the cautious tone of the outlook statement contained in the drinks group’s full-year results. As well as the comment, which complained of “global uncertainties” and a “difficult” euro zone, analysts also highlighted the lack of news about another takeover target to fill the gap left by the abortive bid for Peter Lehmann. This overshadowed a 9 per cent rise in underlying profits.
The gloom spilled into the wider drinks sector with Scottish & Newcastle off 2.1 per cent at 349-3/4p and Diageo losing 1 per cent at 683p.
Sage Group fell 4.5 per cent to 174-1/2p as Graham Wylie, one of the founders of the accountancy software company, sold a 5 per cent stake for (pounds) 116 million. Deutsche Bank placed 65.1 million shares at 178-1/2p with a number of institutions, including hedge funds.
Life insurers were stronger as brokers issued broadly positive notes in the wake of Legal & General’s strong new business data on Monday. L&G itself rose 3.3 per cent to 108-1/4p, Aviva added 2.5 per cent at 518-1/2p and Prudential firmed 1.7 per cent at 467p.
Banks were also firmer, notably Abbey National, 2.8 per cent better at 596-1/4p, as rumours of bid interest from National Australia Bank resurfaced.
Cyclicals were in demand, justifying a 4 per cent rise to 136-1/ 4p for telecoms group Cable & Wireless. Peer Kingston Communications rose 7.1 per cent to 68p as it won a (pounds) 50m interactive communications contract, while Colt Telecom added 2.3 per cent at 110p and Fibernet firmed 7.4 per cent at 101p.
Reuters, the financial information group, rose 3.4 per cent to 252p after two price target increases from brokers. Unilever recovered 3 per cent to 501-1/2p after Monday’s sales warning- induced slide as analysts offered crumbs of comfort. ITV merger partners Granada and Carlton Communications ticked higher as the latter finally bowed to shareholder pressure and accepted that chairman Michael Green should not take the same role at the future ITV plc. Carlton rose 3.4 per cent to 221p and Granada firmed 2.2 per cent at 118p.
