WEDNESDAY MARKET CLOSE: Festive FTSE higher after bid report

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Shares in replacement hip and knee firm Smith & Nephew jumped amid speculation that US rival Stryker is planning a takeover of the company valued at £10.5 billion.

Smith & Nephew, which employs 11,000 staff in more than 90 countries, lifted almost 8 per cent after a report that a bid could come within weeks. The shares added 84p to 1,173p.

The stock was the star performer in an otherwise quiet half day on the London Stock Exchange as traders eased into the holidays.

The FTSE 100 Index kept adding to its rally, closing 11.75 points higher at 6,609.93 to notch up its seventh consecutive session in the black.

Chris Beauchamp, market analyst at IG, said: “With much of Europe out of action already, volumes are thinner than the spread on Scrooge’s Christmas table.

“However the Santa Rally did its work and markets look a lot healthier than they did just a week ago, even if the FTSE 100 is still down on the year and lagging behind the Dax and the Dow Jones.”

Other risers included stocks in the retail sector after estimates from the Department for Business, Innovation and Skills pointed to a record year for the UK high street, with retail sales forecast to reach around £342bn.

The figures, which come amid signs of a strong festive period for retailers, helped beleaguered supermarket stock Tesco rise by 1.4p to 186p. Rival Morrisons was 1.3p higher at 181.7p. Other risers included oil giant BP, which was up by a penny at 416.85p, and broadcaster ITV with a gain of 2.1p to 216.2p.

The biggest faller was FTSE 100 newcomer Indivior as some of the excitement surrounding its strong market debut began to fade. The pharmaceuticals business, which focuses on drugs to fight alcohol and cocaine addiction, surged 25 per cent on the first day of trading since its split from Reckitt Benckiser, but followed that with a 3 per cent drop to 145p.