London midday: FTSE recovers as traders sanguine over Greece

Equity traders and investors in London threw off the morning's caution to lift the benchmark FTSE indices back above the week's highs, in start contrast to losses elsewhere in Europe.

The FTSE 100 was up 0.28% to 7,060.52 not long after midday, with the FTSE 250 continuing its barnstorming charge since the UK election, up 0.20% on the day to 18,273.55.

Despite ongoing uncertainty over Greece and ahead of the release of what are expected to be downward revised US growth data later.

Although markets are pricing in a 70% of a Greek default, traders are becoming sanguine about a Greek exit from the single currency.

"It’s ultimately a question of when rather than if," said Brenda Kelly at London Capital Group. "General crisis fatigue is setting in and while volatility exists, the lack of a protracted sell-off could indicate that perhaps markets are being slightly sanguine of the ramifications of this possibility."

The UK indices reflected more optimism and share price gains for heavyweights Shell, HSBC and Vodafone.

Data showed UK business confidence was at an eight-month high, in fact. The Lloyds Bank Business Confidence Barometer climbed 2% month-on-month to 55% in May, reaching its highest level since September on rising optimism about the economy and trading prospects.

This was in spite of reports that Greece had slunk back into a recession and investors on the Continent fear that the cash-strapped country will be unable to meet its IMF repayment next week.

Topping the FTSE 100 was Associated British Foods after Goldman Sachs upgraded its shares to ‘buy’ from ‘sell’ and raised the price target to 3120p from 2755p, saying that the stock’s 17% underperformance year-to-date offers an attractive entry point.

Ophir Energy was another on the up thanks to an upgrade, with Barclays making the oil company one of its top sector picks.

US data centre company Equinix has agreed to acquire British peer TeleCity Group in bid that would create the largest data centre player in Europe, though Telecity's shares were down slightly on the confirmation. Telecity has agreed to terminate another merger it had agreed with Interxion on 9 March. The price agreed represents a value of approximately 1,145p per Telecity share and a total value of approximately £2.35bn.

Synergy Health was down 1.9% as it confirmed that the Federal Trade Commission (FTC) had informed that it intends to seek to block the proposed merger. The two companies have now announce that they will contest the FTC's attempt to block their proposed combination.

Integrated support services company Carillion was up slightly after acquiring Canadian camping group Outland for £63m. Carillion chief executive Richard Howson said: “Acquiring Outland is another important strategic step in the development of our support services business in Canada.”

Market Movers

techMARK 3,335.60 +0.19%
FTSE 100 7,058.16 +0.24%
FTSE 250 18,273.87 +0.20%

FTSE 100 - Risers
Weir Group (WEIR) 2,032.00p +2.83%
Associated British Foods (ABF) 3,020.00p +2.37%
Fresnillo (FRES) 752.00p +1.55%
Shire Plc (SHP) 5,725.00p +1.33%
Prudential (PRU) 1,651.00p +1.16%
Vodafone Group (VOD) 256.60p +1.14%
CRH (CRH) 1,867.00p +1.08%
3i Group (III) 570.50p +1.06%
Randgold Resources Ltd. (RRS) 4,729.00p +1.00%
Persimmon (PSN) 1,983.00p +0.86%

FTSE 100 - Fallers
Anglo American (AAL) 1,020.50p -1.40%
Intertek Group (ITRK) 2,503.00p -1.34%
Morrison (Wm) Supermarkets (MRW) 174.90p -1.19%
TUI AG Reg Shs (DI) (TUI) 1,174.00p -1.18%
Diageo (DGE) 1,823.50p -0.98%
Ashtead Group (AHT) 1,151.00p -0.86%
SABMiller (SAB) 3,544.00p -0.84%
AstraZeneca (AZN) 4,457.00p -0.78%
Hargreaves Lansdown (HL.) 1,283.00p -0.77%
Rio Tinto (RIO) 2,864.50p -0.68%

FTSE 250 - Risers
Infinis Energy (INFI) 188.50p +4.49%
Ophir Energy (OPHR) 132.10p +3.85%
Card Factory (CARD) 358.50p +3.40%
Booker Group (BOK) 175.70p +3.35%
PayPoint (PAY) 981.00p +3.26%
Spire Healthcare Group (SPI) 361.20p +3.02%
Big Yellow Group (BYG) 661.00p +2.16%
WH Smith (SMWH) 1,576.00p +2.01%
Wood Group (John) (WG.) 746.00p +1.91%
Centamin (DI) (CEY) 69.80p +1.90%

FTSE 250 - Fallers
Evraz (EVR) 169.70p -2.25%
Ocado Group (OCDO) 370.70p -1.98%
Synergy Health (SYR) 1,863.00p -1.69%
Soco International (SIA) 181.80p -1.68%
Jardine Lloyd Thompson Group (JLT) 1,040.00p -1.61%
Rexam (REX) 558.50p -1.41%
Investec (INVP) 603.50p -1.39%
Renishaw (RSW) 2,473.00p -1.32%
Euromoney Institutional Investor (ERM) 1,180.00p -1.26%
BTG (BTG) 714.50p -1.24%