Footsie carried higher despite Vodafone slip

They say a rising tide lifts all boats and the FTSE 100 was duly carried higher yesterday as flood waters continued to cause chaos in Britain.

The gains came despite another waterlogged performance from Vodafone, the UK's biggest stock, which failed to recover from last week's earnings-related nerves and slipped a further 3.9 per cent.

Stocks in London were helped by a bid for Lasmo, the oil exploration group, from Amerada Hess of the US - a deal which promised to inject around €1.7 billion of cash into the UK market. The news was the second big bid story in the last week, after Abbey National's approach to Bank of Scotland.

After all the recent profit warnings, investors responded well to second quarter figures from British Airways, which duly became the best performer in the FTSE 100 index.

The FTSE 100 was never in negative territory, finishing 45.6 points ahead at 6,431.0. Thanks to Lasmo, the FTSE 250 index enjoyed a 77.6 gain to 6,826.8 while the SmallCap advanced 14.7 to 3,349.3.

The only loser of the main indices was the Techmark 100 which slipped just 0.87 to 3,498.51, weighed down by losses at Sema and Psion and nervousness ahead of the publication of Cisco results after the New York close last night.

But it was not one of those days when either the old economy or new economy sectors triumphed. The worst performers in the FTSE 100 were old economy stalwarts Invensys and Marks & Spencer. MS reports figures today.

There were few signs of significant nerves ahead of the big news of the week. The Dow Jones Industrial Average was up more than 150 points ahead of today's US elections. The Chancellor's pre-budget statement may be eagerly awaited by fuel protesters but is not expected to have a big impact on markets.

On interest rates, the latest domestic data showed that manufacturing output fell 0.4 per cent in September and industrial production, which includes the energy industries, dropped 1.1 per cent.

Although the figures were seen as slightly erratic they did not provide much evidence for the hawks on the Bank of England's monetary policy committee. The MPC meets on Wednesday and Thursday this week and is expected to keep rates unchanged, as it has since February.

Turnover was healthy for a Monday, with 1.85 billion shares traded by the 6 p.m. count. Vodafone and Lasmo between them contributed around 500 million shares.