Market Report: Smiths' crisp rises as Footsie recovers

England's most common surname proved a coincidental hit with investors yesterday as the City's leading share index showed further signs of recovery. Smiths Group, the technology specialist which makes X-ray machines and detectors to check cargo freight for explosives, rose 49p to 1,319p after an upgrade from analysts at UBS.

Last month, the firm revealed it had received an approach for its medical division which could net it about £2bn and UBS said it believes a sale "will realise the fundamental value of the business", and upgraded it to a buy.

"It is likely to attract bidders for the other Smiths businesses and will reduce the conglomerate discount some investors apply to Smiths," the broker added.

Not to be completely outdone, packaging group DS Smith climbed 12.9pp to 252.7p after its 2012 profits rose 51 per cent to £166.2m and the company outlined €120mn (£102m) in cost savings.

Smith & Nephew also rose by 3.5p to 737p.

Overall, the FTSE 100 continued on an upward trend, climbing 77.92 points to 6,243.40 having been hit by fears over the global economy last week.

William Nicholls, a dealer at Capital Spreads said: "The 'risk-on' button has been firmly pressed again today as the equity markets receive their third cash influx on the trot.

"As company shares start trading across the pond the move has only accelerated to the upside and it almost seems as though investors are now panicking about missing the move – they are seeing real value following the torment of the last couple of weeks.

"This rally is starting to pick up momentum now which may well continue in the near-term and beyond. All of a sudden there is a new air about the markets," he added.

Direct Line Group advanced by 1.3p to 228.7p despite cutting 2,000 jobs on Wednesday.

"The stock offers one of the highest yields in the sector, which we believe is well underpinned, especially given new initiatives on cost savings," broker Normura said. "However, we expect limited, near-term performance in the shares after the catalyst of the new cost initiatives."

Elsewhere, Standard Chartered fell before closing up 5.5p at 1,436p as Morgan Stanley rated the company overweight.

"Asia macro improvement leads us to expect growth from the company, though margin compression is a concern, which is most exposed among our European banks. The prospect of Asia slowing is now reflected in our bear case."

WPP was another beneficiary of bullish sentiment, rising 49p to 1128p.

Experts pinpointed a bullish note from Bank of America Merrill Lynch as the reason. The broker added the advertising group to its most-wanted list.

"WPP offers an attractive combination of value and growth and therefore should perform well under the boom phase of the style cycle," BofA ML said. "We believe WPP is attractive versus quality consumer staples trading on close to 20 times PE."

Among the mid caps, Icap, the inter-dealer broker run by Michael Spencer, was in focus amid claims that David Casterton, a senior executive, knew that some of the firm's brokers worked with traders at UBS AG to "manipulate" benchmark interest rates.

The story was staunchly played down by Icap yesterday: "Neither the company nor its senior management was aware of any corrupt payment from any source at any time. Any suggestion otherwise is false and defamatory."

Icap shares crept up 4.3p to 357.9p.

And finally, Renewables Infrastructure Group unveiled plans to raise £300m in an IPO in London. The fund plans to buy wind farms and solar parks in Britain, France and Ireland with a total capacity of 276 megawatts.

Renewables Infrastructure "will give investors the potential to secure a long-term, stable, inflation-linked yield from a diversified portfolio of high-quality operational wind and solar assets", chairman Helen Mahy said.

Looking ahead to the next few days, experts were positive the market could make further gains.

"First it was the turn of the optimists to feel the pain, now the pessimists are beginning to doubt themselves. After three strong 'up' days for the FTSE 100, the bears can be forgiven for feeling downcast," said David Madden, at IG.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + competitive: SThree: £20000 - £25000 per annum + c...

Recruitment Genius: Account Handler - Personal Lines

£20000 per annum: Recruitment Genius: This provider of insurance and financial...

Recruitment Genius: Graduate Developer / IT Support Engineer

£16000 - £25000 per annum: Recruitment Genius: This fast growing financial ser...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + competitive: SThree: SThree are a global FTSE 250 ...

Day In a Page

Solved after 200 years: the mysterious deaths of 3,000 soldiers from Napoleon's army

Solved after 200 years

The mysterious deaths of 3,000 soldiers from Napoleon's army
Every regional power has betrayed the Kurds so Turkish bombing is no surprise

Robert Fisk on the Turkey conflict

Every regional power has betrayed the Kurds so Turkish bombing is no surprise
Investigation into wreck of unidentified submarine found off the coast of Sweden

Sunken sub

Investigation underway into wreck of an unidentified submarine found off the coast of Sweden
Instagram and Facebook have 'totally changed' the way people buy clothes

Age of the selfie

Instagram and Facebook have 'totally changed' the way people buy clothes
Not so square: How BBC's Bloomsbury saga is sexing up the period drama

Not so square

How Virginia Woolf saga is sexing up the BBC period drama
Rio Olympics 2016: The seven teenagers still carrying a torch for our Games hopes

Still carrying the torch

The seven teenagers given our Olympic hopes
The West likes to think that 'civilisation' will defeat Isis, but history suggests otherwise

The West likes to think that 'civilisation' will defeat Isis...

...but history suggests otherwise
The bald truth: How one author's thinning hair made him a Wayne Rooney sympathiser

The bald truth

How thinning hair made me a Wayne Rooney sympathiser
Froome wins second Tour de France after triumphant ride into Paris with Team Sky

Tour de France 2015

Froome rides into Paris to win historic second Tour
Fifteen years ago, Concorde crashed, and a dream died. Today, the desire to travel faster than the speed of sound is growing once again

A new beginning for supersonic flight?

Concorde's successors are in the works 15 years on from the Paris crash
I would never quit Labour, says Liz Kendall

I would never quit party, says Liz Kendall

Latest on the Labour leadership contest
Froome seals second Tour de France victory

Never mind Pinot, it’s bubbly for Froome

Second Tour de France victory all but sealed
Oh really? How the 'lowest form of wit' makes people brighter and more creative

The uses of sarcasm

'Lowest form of wit' actually makes people brighter and more creative
A magazine editor with no vanity, and lots of flair

No vanity, but lots of flair

A tribute to the magazine editor Ingrid Sischy
Foraging: How the British rediscovered their taste for chasing after wild food

In praise of foraging

How the British rediscovered their taste for wild food