'Choppy session' leaves Footsie little changed

THE London market closed in negative territory yesterday despite a strong showing from mining and oil shares.

The FTSE 100 index closed 4.1 points down at 6,636.8 - despite peaking 34.1 points ahead during the day - but held steady above the 6,600 barrier breached late last week.

Paul Webb, a trader at CMC Markets, said: "It's been a choppy session for the FTSE, but the London index remains comfortably above the 6,600 level that had provided some solid resistance in recent weeks."

Heavily weighted miners secured the top five spots on the risers' board as firmer metal prices gave the sector an uplift.

Anglo American led the pack after a broker upgrade with a rise of nearly 4 per cent, or 98p, to 2,973p. Kazakhmys, up 39p to 1,236p, and Xstrata ahead 78p to 2,790p, followed as copper prices rebounded from an eight-week low seen last week.

Fellow miner Lonmin also advanced, ahead 101p at 3,945p, while BHP Billiton cheered 24p to 1,222p.

Gas producer BG Group benefited from takeover speculation, with ExxonMobil said to be interested in the firm. Its shares were up 11.5p to 791.5p.

Oil giants BP and Royal Dutch Shell also rose on the back of merger and acquisition rumour, with talk of a possible tie-up between the two continuing to buoy their share prices, boosted by a broker note from ABN Amro that said any bid for Shell could see shares hit 3,000p. Shell was ahead 27p at 1,903p and BP rose 8p to 590p.

Pubs and restaurant group Mitchells & Butlers won back its early gains as enthusiasm over the potential sale of the All Bar One owner's property assets encouraged investors.

The shares, which started the day leading the Footsie risers, recovered from a mid-session slump to finish 10p ahead at 877.5p as City watchers eyed potential gains from a joint venture with property tycoon Robert Tchenguiz.

The news lifted rival pubs chain Punch Taverns, up 19p to 1,397p. M&B had previously ruled out converting its property portfolio to tax-efficient REIT status.

Other risers included pharmaceuticals firm Shire, which announced approval from US regulators for a new hyperactivity drug, lifting the shares 3p to 1,173p.

Retailer Next also started the week on a positive note, thanks to an upgrade from Seymour Pierce, boosting shares by 43p, or 2 per cent, to 2,327p.

But drugs giant GlaxoSmithKline led the fallers, down 5 per cent after a study said that Avandia, its diabetes drug, could increase the risk of heart attacks. The shares fell 74p to 1,390p.

Strong full-year results buoyed self-storage firm Big Yellow Group, up 26p at 617p, despite the firm admitting it was highly sensitive to the housing market and the impact of interest rate rises.

Aim-listed IX Europe, which runs data centres, said it had received a number of preliminary bid approaches, which may lead to an offer for the company. Its shares closed 9.25p up at 124p.