SHARES in security services group G4S were the biggest fallers in the leading index for the second day running, even as the market closed near a 21 month high on renewed economic optimism and a spate of takeover news.
Hot on the heels of a disappointing 2010 forecast, G4S was hit by news of the sale of around 10 per cent of its shares. A trust associated with one of the founders of the company sold 141m of its 172m shares at 255p each, raising around £360m. The shares were placed by Royal Bank of Scotland and taken up in the main by UK investors. G4S shares fell 4.94 per cent to 255.9p.
Elsewhere, trading was on the healthy side as a bid for transport group Arriva caused excitement in the sector and mining stocks were on top form. Investors also welcomed the Federal Reserve’s pledge to hold interest rates near zero.
The FTSE 100 ended up 24.20 points, or 0.4 per cent, at 5,644.63, its highest close since late June 2008.
“Yesterday’s news from the Fed has bolstered the move of cash back into risk assets, mainly banks and commodity issues, despite the strong recent rally,” said Mic Mills, senior trader at ETX Capital.
Miners were the top blue-chip gainers, with Fresnillo, Kazakhmys, Xstrata, Vedanta Resources, and Lonmin up 1.6 to 2.7 per cent. Rio Tinto added 2.5 per cent. China’s top state-owned nonferrous metals company Chinalco confirmed it is in talks with Rio Tinto about potential joint ventures in Mongolia and Guinea, a Chinese newspaper said yesterday.
Oils were also in demand, as crude rose above $82 a barrel, with BG Group and BP both rising.