Leading stocks have held steady in afternoon trade amid a cheery trading update from bank Lloyds TSB and as the arrest of former Iraqi President Saddam Hussein boosts market sentiment to drive Wall Street higher.
Gas and power utility Centrica was another feature today, up 3.8 per cent at 213p as a recent strong run was given new life when it broke through 200p on Friday for the first time since July 2002. Dealers said a bullish analyst note from its house-broker ABN had sparked Friday's surge.
The FTSE 100 index was up 0.5 per cent at 4,367.6 15:00 . Banks accounted for around a quarter of the move. The mood was also buoyant on Wall Street, where the Dow Jones industrial average rose 0.6 per cent in early trade.
But market watchers said that while the capture of Saddam had temporarily eased concerns about geopolitical tensions, equity investors would soon return their focus to issues such as the economy and corporate earnings.
Lloyds TSB , the UK's fifth-largest bank, stood out among FTSE gainers with a 3.5 per cent rise. The move came after Lloyds said its full-year performance would be in line with market forecasts and that lending profitability stabilised.
Travel and leisure stocks also gained amid easing Middle East tensions. Airline British Airways rose 4.6 per cent, cruise operator Carnival was 1.3 per cent better and holiday firm MyTravel jumped 12.7 per cent.
But food and clothing retailer Marks & Spencer lagged the rest of the market with a 1 per cent fall after investment bank Credit Suisse First Boston trimmed its earnings forecasts for the group and said clothing strategy at M&S needed a "major reset".
Elsewhere in the retail sector, mid-cap book and newspaper seller WH Smith declined to comment on talk of difficult trading at the start of the Christmas season, which tugged its shares 5.7 per cent lower.