The recent rally by the London market extended into a fourth session today despite sharp losses for mobile phone firm O2.
Shares in O2 dropped more than 5% on reports that German firm Deutsche Telekom was not planning a counter bid to rival the £17.7bn takeover by Telefonica.
Across-the-board gains by financial services firms triggered the latest advance by the FTSE 100 Index, which lifted 16.8 points to 5361.1 in the first hour of trading.
Insurance firm Royal & Sun Alliance led the way with a 3% or 3p gain to 103.5p and was closely followed by sector rivals such as Friends Provident – up 2.75p at 180.5p.
Catering giant Compass added 4.5p to 194.5p as investors took the view that there was substance to reports that private equity firms such as Texas Pacific Group were contemplating a bid.
However, dwindling hopes of a takeover battle pushed the share price of O2 below the 200p that Telefonica has agreed to pay for control.
O2 dropped 11p to 198.25p, but investors in Vodafone were more chipper as the stock added a penny to 150.5p.
Elsewhere, aviation services firm BBA rose 7% or 19.75p to 310.75p after announcing plans to spin off its unit making fibres for products such as nappies and shoelaces.
Celebrity jeweller Theo Fennell lifted 9% or 3.5p to 41.5p after being approached by a party wishing to make a significant investment.
References: EGi News 02/11/05
