Market Update - 22 August

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The FTSE 100 was up 57.3 points at 5427.5 and the FTSE 250 was up 120.7 points at 9059.8 at 11:41 on Friday morning.

The banking sector bounced back from earlier lows, dominating the FTSE 100 leader board. Lloyds TSB, at fourth place on the London benchmark, was up 3.93 per cent or 11p at 291p, and HBOS advanced to 283.5p, up 11.5p. The Royal Bank of Scotland was up 7.75p at 217.25p and Barclays gained 9.5p to 320.5p.

Moving up...

Liberty International was the strongest on the senior index, up 7.37 per cent or 64.5p at 939.5p, after Simon Property Group, the US real estate giant, declared a 3.45 per cent stake in the company.

Among the mid-caps, Benfield soared to 349.5p, up 78.5p or 28.97 per cent, after Aon revealed a recommended 350p per share offer for the reinsurance and risk intermediary.

Commenting on the news, Cazenove said the offer will have a positive read across for Jardine Lloyd Thomson, which was up 11.5p at 450p this morning.

The house builders supplemented last night's, short-covering driven gains and Taylor Wimpey was up 10.06 per cent or 4.25p at 46.5p. Persimmon, which forced short-sellers to abandon their positions after posting a reassuring set of results, was up 8.33 per cent or 27.25p at 354.25p.

Also on the upside, transport group Arriva was up 33.5p at 746.5p after positing forecast beating interim results.

Among smaller companies, Collins Stewart gained 4.27 per cent or 3.75p to 91.5p on talk of a new bid, which some rumours suggest offer as much as 120p per share for the broker.

Moving down...

Oil companies eased back as investors took profits, despite an overnight spike in commodity prices. As a result, Tullow Oil came off the rally path, down 17p at 782.5p, the weakest on the FTSE 100.

Cairn Energy was down 56p at 2820p and BP lost 3.5p to 513.5p

The miners were also down and Vedanta Resources eased back to 1804p, down 4p. Lonmin, which is the subject of a hostile takeover attempt by Xstrata, was down 6p at 3444p. Xstrata managed to remain firm, however - the Anglo-Swiss miner was up 24p at 3184p.