WEDNESDAY MARKET CLOSE : Car insurers help market accelerate

Insurers advanced on signs of a rebound in car premium rates. Picture: TSPL

The FTSE 100 Index was driven higher yesterday after insurers advanced on signs of a rebound in car premium rates and GlaxoSmithKline surged in the wake of better-than-expected quarterly results.

The AA said car insurance premiums rose for the first time in more than two years, with the average cost of an annual comprehensive car insurance policy rising 1.2 per cent, or £6.

Direct Line Insurance and Admiral occupied the top two positions in the FTSE 100 as the top flight closed 27.4 points higher at 6,399.73. The pair rose 8.5p at 279.6p and 42p to 1,285p respectively, while in the FTSE 250 Index Esure was up 13.1p at 235p.

GlaxoSmithKline also cheered the market after it pledged to return an additional £4 billion to shareholders via a special share scheme and eyed a potential flotation of its HIV drug business. Despite the pharmaceutical giant’s third-quarter sales falling 10% to £5.7bn, its shares rose 35p to 1377p.

The improvement for the blue-chip index built on a much-needed rebound on Tuesday, when the top flight rallied by more than 100 points on hopes that the European Central Bank will further expand liquidity by widening its bond purchase programme.

Shares in consumer goods firms came under pressure after British American Tobacco reported a big fall in quarterly revenues.

The tobacco giant slid almost 3 per cent, or 91.5p, to 3,375p after it said sales in the first nine months of the year were down 9.6 per cent due to currency movements and lower volumes in key markets including Russia and Brazil. Supermarkets were among other fallers as investors prepared for half-year results today from Tesco, which dropped 1.5 per cent to 183p. Rival Sainsbury’s was harder hit, down 3.4 per cent at 241.6p.