The FTSE 100 was up 24.24 points at 4333.32 and the FTSE 250 climbed to 6300.77, up 49.72 points, at 11.36am.
Housebuilder Taylor Wimpey, up 4.59 per cent or 0.45p to 10.25p, was in focus this morning after a trade magazine published a leaked email from chief executive Peter Redfern which suggested that the company was closer to striking debt deal with lenders.
“Given that our share price is ‘somewhat volatile’ and that over the last few weeks we have had more press coverage than if Angelina Jolie gave birth to Siamese twin chimpanzees, I thought it was time for a further update,” Mr Redfern wrote, adding:
“We have had a very productive couple of weeks on our debt negotiations with our banks and US lenders, significantly increasing our confidence of reaching an acceptable solution for the company. We have also had our first meetings with Eurobond representatives, which have been constructive and sensible.”
“There is plenty of water to go under the bridge, as there… is a formal process to go through that will probably run until roughly the end of February, however, risks have reduced materially.”
Commodities stocks remained firm ahead of confirmation of a production cut from the OPEC oil cartel, which is meeting in Algeria. The hopes pushed up the price of oil and metals.
As a result, in the mining sector, Fresnillo was up 7.97 per cent or 13.4p at 181.5p while Lonmin recovered to 715p, up 4.76 per cent or 32.5p.
Among oil & gas issues, BG was the strongest, gaining 3.16 per cent or 30.5p to 997p.
Also on the upside, Marks & Spencer edged up by 0.25p to 227.75p after Societe Generale weighed in with a “buy” note, saying:
“In the context of the UK non-food retail sector, M&S has a strong balance sheet…We view M&S as a key cyclical recovery play for 2009.”
The endorsement offset the impact of some negative commentary from Pali International, which reiterated its “sell” advice.
“Industry sources indicate that M&S had an appalling week last week, with sales as much as 20-25 per cent down on last year in some stores, with consumers clearly unimpressed by the modest promotions they had to offer last week and waiting for them to go on full Sale again,” Pali analyst Nick Bubb said, adding:
“However successful the two ‘20 per cent off everything’ one-day sales were on November 20th and December 4th, it looks as if they simply pulled business forward and undermined consumer trust in the brand. With Debenhams upping the promotional ante again this week, with more up to 50 per cent off discounts, M&S’s hand may be forced and it may have to have another one day sale again pre-Christmas, which would destroy what’s left of its pricing power.”
HSBC remained on the back foot, losing 6.22 per cent or 44.5p to 670.5p, amid continuing speculation that it may have to raise up to $14bn in fresh capital.
Parts of the wider banking sector were also weak with HBOS down over 4 per cent or 2.9p at 69p and Lloyds TSB down 0.47 per cent or 0.6p at 127.4p. Although traders were pleased with the US Federal Reserve’s overnight decision to reduce interest rates, there was concern about the impact of yet tougher economic conditions in the UK after official data showed that unemployment had climbed to its highest level since 1997.Reuse content