Advances from BG Group and Shell help lift the FTSE 100

BRITAIN’S top share index pushed higher yesterday, helped by a rally in heavyweight commodity issues, notably oil major Royal Dutch Shell, whose third-quarter results beat market expectations.

The FTSE 100 ended up 31.87 points, or 0.6 per cent, at 5,677.89, recovering after it reached its lowest closing level since 5 October on Wednesday.

Energy issues were in demand as Shell, up 0.5 per cent, posted an 18 per cent jump in third-quarter profits thanks to higher oil and gas prices, setting a benchmark for the sector. Shell said a five per cent rise in production led profits to rise $3.5bn (£2.2bn) for the three months to 30 September.

Peer BG Group added 0.8 per cent after saying it had begun production from Tupi, one of its key fields, in the Santos basin off the coast of Brazil.

Miners found support as investors switched out of the dollar following recent strength boosting metal prices, with BHP Billiton the best off, up 2.7 per cent.

The UK blue-chip index drifted off a session peak above the 5,700 level late in the afternoon as Wall Street turned lower after opening gains.

US blue chips were down 0.2 per cent by London’s close, weighed on by weakness in tech and industrial issues and speculation the Federal Reserve's proposed economic stimulus programme will be less aggressive than initially thought.

This was given some extra weight by more positive economic data as weekly jobless claims unexpectedly fell to 434,000.

Investors will look for Friday’s US third-quarter GDP figures to show further direction ahead of next week’s key meeting by the Fed’s FOMC policy-setting panel.

The latest Reuters survey showed most leading economists expect the Fed to buy between $80bn and $100bn worth of assets per month, with estimates for how much it will eventually spend varying from $250bn to $2trn.

Blue-chip heavyweight Vodafone lent the market the most strength, adding 2.7 per cent to hit a two-year high, as the mobile operator benefited from strong results from its peers, notably France Telecom.

Among other gainers, ARM Holdings added 3.2 per cent as the chip designer bounced back from a retreat following results, and with an H2O Markets “buy” rating.

On the downside, AstraZeneca dropped 3.3 per cent as the drugmaker’s revenue fell four per cent in the third quarter, hit by generic competition to key drugs and the absence of last year's windfall sales of swine flu vaccine. Peer GlaxoSmithKline shed 0.9 per cent.

Temporary power supplier Aggreko was the biggest blue-chip faller, down 4.2 per cent as it raised its full-year outlook again, with JP Morgan staying “neutral” and saying the stock’s looks full.