Early FTSE optimism peters out

London's leading shares are hovering above the 4000 barrier after an early rally petered out.

London's leading shares are hovering above the 4000 barrier after an early rally petered out.

The FTSE 100 index shed some of its 27.4 point rise in the first hour of trading to achieve a more modest gain of 9.2 points at 4050.9 by mid-morning.

After a strong overnight performance on Wall Street and positive hints about the health of the US economy, traders appeared to lose confidence amid a slow end to the week for British company news.

On top of positive US employment data on Thursday, commentators said remarks by US treasury secretary John Snow helped improve the mood on Wall Street, which took a knock the previous day after a quarter-point cut in interest rates disappointed many.

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With only a handful of London's blue-chip shares in negative territory, the most significant move came from banking group Bradford & Bingley after it warned first-half profits would be lower than last year's.

The group's shares topped the list of Footsie losers as it fell 9 per cent or 30.75p to 307.25p, while rival Northern Rock was also dragged down, losing 12.5p to 719.5p.

Alliance & Leicester was off 1.5p at 845.5p. Abbey National showed no change at 474.5p and HBOS fell 9p to 795p.