Further gains from lethargic trading

LONDON FTSE 100 CLOSE 5,237.92 +20.1

THE Footsie marked its sixth successive day of gains yesterday but trading failed to inspire during a lacklustre session.

The blue-chip index finished 20.1 points ahead at 5,237.92, despite early wobbles on Wall Street after a sudden fall in US home construction during May.

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Investors had little to get their teeth into in a slow day for corporate news, although many financials and energy stocks advanced as markets showed some increase in risk appetite.

The pound also rose to its highest level for more than a month against the dollar – passing $1.48 – and traded at around 1.20 against the euro.

Joshua Raymond, market strategist at City Index, said: "You get the feeling that there are a lot of investors who are simply sitting on the sidelines. Are they simply watching the World Cup or are they concerned about how financial markets may play out over the rest of the month? My assumption is both."

James Hughes, market analyst at CMC Markets, added: "Traders have had to endure a fairly lifeless session as the major indices failed to get excited by the numbers that were due for release.

"It was in fact a pretty busy day on the economic calendars with UK unemployment figures followed by US producer price index just before the US open."

Shell added 36.5p to 1,757.5p and BG Group rose 23p to 1,136p, although BP shares were down 5p to 337p as the firm faced a meeting with US president Barack Obama in Washington.

In the financial sector, Royal Bank of Scotland rose 0.95p to 45.2p, while Prudential added 10p to 570p after Nomura brokers lifted their target price on the stock.

A slow day was dominated by supermarket Sainsbury's, which posted its weakest growth in five years following a 1.1 per cent rise in like-for-like sales in the 12 weeks to 12 June.

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The performance had been expected due to falling food price inflation, meaning shares rose 2.8p to 327.2p and rival Tesco lifted 1.5p to 396p.

On the fallers' board, shares in Severn Trent and United Utilities were down 54p to 1,249p and 21p to 538.5p respectively as the pair turned ex-dividend, meaning shareholders are not entitled to the latest payout.

Satellite firm Inmarsat was again a leading Footsie casualty after a broker downgrade on Tuesday. Shares in the company were off 29.5p at 750p.

Outside the top flight, shares in engineering and outsourcing firm Mouchel fell by 5.75p to 151.25p – a drop of 4 per cent – after it predicted a "difficult" short-term outlook due to the squeeze on public spending. Plastics manufacturing firm Filtrona led the FTSE 250 Index risers board after it said trading in the first half of its financial year was "materially" ahead of its expectations. Shares jumped 13 per cent or 26.4p to 222.5p.

Among the Scottish stocks, temporary power supplier Aggreko continued its recent rise – adding a further 25p, or 1.7 per cent, to close at 1,470p – following an upgrade from "hold" to "buy" by analysts at Citi.

The broker said: "Last week's investor trip to Africa highlighted the sheer magnitude of opportunity that Aggreko has over the short, medium and long run in temporary power. We think there are many years of growth in prospect."