BRITAIN'S leading share index closed at its highest level in more than a year yesterday, as investors continue to pour into equities.
With relatively little news to drive the market, traders mulled the prospect of interest rates staying low well
into 2010 as a reason to buy into shares.
Anthony Grech of IG Index said news next week should provide more direction for the markets, possibly sending the leading index above the currently elusive 5,300 mark.
He said: "US retail sales figures on Monday and UK inflation data on Tuesday both have the potential to add further evidence of economic recovery, but again any shortfall could leave traders itching to book profits."
Trading higher for almost the entire session, the FTSE 100 index ended 19.88 points higher at 5,296.38, the highest close since last September.
As well as a positive start in New York, the London market was also cheered by news that the 16-country Eurozone emerged from recession in the third quarter.
Property firms were on the front foot in London ahead of interim figures due next week. Fund managers have been commenting this week that sentiment towards the sector has improved significantly in recent weeks.
British Land was one of the top risers after brokers at Charles Stanley predicted a positive outlook statement from the firm on Tuesday.
Shares closed up 13.5p to 498.2p, with only Liberty International, up 19p to 504p, gaining more.
Elsewhere, Resolution was lower, a day after saying it was looking to bag more acquisitions. Its shares dropped the most in the top index, falling 3.5p at 92.5p.
Legal & General, which has been boosted by talk of a merger approach from Resolution, Clive Cowdery's acquisition vehicle, slipped 0.35p to 87.6p.
Lloyds Banking Group shares dropped despite analysts at Goldman Sachs reminding clients that the part-nationalised bank was on its "conviction buy" list of its most favoured companies.
In a note, analysts at the broker said that as fears over its capital level recede, "focus will return to what we consider a favourable outlook for gross operating profit".
But it appears the focus yesterday was on more bad news for its loan book, in the wake of property group Kenmore going into administration. Shares in the bank closed 0.2 per cent lower at 89.85p.
Oil and gas giant BG Group rose 2.1 per cent to 1,105.5p after announcing a discovery in Brazil.
And British Airways continued Thursday's strong gains, despite observers questioning whether its announcement that it wanted to merge with Iberia of Spain made the deal more likely.
Nick Cunningham, and analyst at Evolution, said a number of factors could scupper the merger, including BA's pension deficit, competition law worries and "the hugely difficult and uncertain trading environment". BA's shares climbed 2p to 217p.
Marks & Spencer rose 3.4p to 372.3p, despite claims that sales at one of its rivals, Waitrose, may have been boosted by an M&S advertising campaign comparing prices.
Among the midcap companies, shares in Robert Wiseman Dairies rose to an 18-month high on speculation that Monday's interim results will be strong. Shares jumped 22.8p, almost 5 per cent, to 482.8p.
Interdealer broker Tullett Prebon was the FTSE 250's biggest faller after it reported a 9 per cent fall in third-quarter revenue of £302 million. Its shares dropped 12.5 per cent to 349.5p.
