Traders cheer Mubarak's departure

Commodity and banking stocks drove the FTSE 100 index higher yesterday as traders welcomed the decision of the Egyptian president Hosni Mubarak to resign.

Egypt's vice-president, Omar Suleiman, said Mubarak had bowed to pressure from the street and resigned, handing power to the army.

David Jones, chief market strategist at IG Index, said: "Consensus seems to be that this will lead to a smooth transition of power and it's worth noting the slide in oil prices as a result."

Trading had been dampened earlier in the session by uncertainty over the political unrest in the North African country, but sentiment rebounded when the premier stepped down.

Oil stocks pushed ahead, with Tullow Oil finishing as the biggest gainer, up nearly 4 per cent or 53p at 1,452p, and BG Group not far behind, moving up 51.5p to 1,524p.

The pound slipped against the dollar to $1.59 and against the euro to €1.18 as traders await further clarity from the Bank of England over when an interest rate hike might occur, after policy- makers held rates for the 23rd consecutive month on Thursday.

High street giants Next and Marks & Spencer failed to see any turnaround, heading the FTSE 100 fallers' board as investor nerves grew over the twin threat of rising prices and weak demand.

Next and M&S fell 63p to 2,000p and 3.6p to 368p re- spectively, followed by B&Q parent Kingfisher, down 1.2p to 251.8p. In the supermarket sector, Morrisons was the biggest faller with a drop of 1.3p to 276.7p.

Drinks giant Diageo - Scotland's largest whisky producer - regained some of Thursday's post-results fall with a rise of 11p to 1,208.6p.

Insurer Legal & General rose to the top of the Footsie risers' board, gaining 3.9p to 122.7p after a bullish note on the sector from Nomura, saying the market is underestimating the growth potential of L&G's asset management operations.

Fellow insurers Standard Life and Resolution also made gains, up 2.9p to 240p and 6.9p to 272.3p respectively.

Support services giant Carillion was 10.7p dearer at 395.9p after announcing the acquisition of green support services business Eaga for 306.5 million.

Carillion said it had identified the low carbon market as a strategic area of growth and that the Eaga acquisition will create a platform to build the UK's largest energy services provider.

Meanwhile, shares in online grocer Ocado dropped 10.5 per cent or 30p to 255p after the John Lewis pension trust sold its 10 per cent stake for 152m.

The sale in recently listed Ocado was made at a 7 per cent discount to Thursday's closing price.

Home emergency repair group Homeserve edged 11p higher to 462.3p as it said customer numbers rose in line with its expectations since September, up 2 per cent in the UK as of the end of December.Among Scottish firms, penny-stock Angel Biotechnology mounted a 13.5 per cent surge - up 0.06p to 0.51p - after the Aim-quoted firm signed a pricing agreement with Russia's sixth-largest drugs company.