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FTSE firmly higher at midday

MIDDAY REPORT: Headline shares were firmly higher at midday, the gains fuelled by strength among oil issues on the back of firm crude prices, with British Energy among the top blue-chip risers after confirming bid approaches.

At high noon, the FTSE100 was 83.2 points higher at 6,335 with the FTSE250 ahead 161.5 points at 10,500.4 and the FTSE Smallcaps 5.2 points weaker at 3,218.

NEW YORK

Wall Street is on track to open higher Friday, looking to advance for a third day straight, and following on from gains in Europe, although any bad news in today's housing report could dent investors' confidence.

According to spread bettors IG index, the Dow Jones Industrial Average is expected to open around 26 points higher at 13,018. S&P 500 futures were 3.9 higher at 1,427.5, while Nasdaq 100 futures were up 2.5 to 2,536.2.

LONDON MARKETS - BLUE CHIPS

The oil sector underpinned the FTSE100 gains, after crude moved above $126 a barrel due to weakness in the US dollar and tight global distillate markets.

BP added 10p to 635.25p, while Shell took on 38p to 2,097.5p, BG Group was up 15p at 1,322.5p, Cairn Energy climbed 44p to 3,574.5p and Tullow Oil gained 15.5p to 939.25p.

While increasing fuel prices have been a factor depressing British Airways' share price, BA climbed 12.5p to 236.5p after the group unveiled a 44.5% rise in its full-year pretax profit, and said it would pay a dividend of 5p. Following the numbers, Deutsche Bank reiterated its 'buy' rating.

On the M&A front, British Energy was up 45.5p at 725.5p, after the group said it has received at least two offers for the company, with sources close to the deal saying these include offers from EdF and Iberdrola SA.

Suez, another rumoured bidder, denied making an offer.

Bid talk boosted interdealer broker ICAP 26.5p to 661.5p as vague rumours circulated that Intercontinental Exchange, owner of London's crude oil exchange, is interested in making a bid.

National Grid added 22.5p to 738.5p, as Credit Suisse said the stock is a 'trading buy' after 'strong' full-year results on Thursday, while reiterating its 'neutral' recommendation and 880p target price.

Compass Group added 12p to 368.25p as Goldman Sachs lifted its stance to 'neutral' from 'sell', following H1 results from the contract caterer on Wednesday.

3i Group climbed 30p to 925p, following solid full-year results on Thursday, in response to which Merrill Lynch upgraded the group's target price to 1,225p from 1,150p, maintaining its 'buy' rating. The broker said the private equity company is an undervalued share which is in 'excellent shape' as a business.

Among today's mere handful of casualties, supermarket group Sainsbury shed 3.75p at 373.75p, extending losses after Wednesday's disappointing full-year figures.

MIDCAP NEWS

On the second tier, Petrofac took on 29.5p to 658p, after the group said it expects net profit for 2008 to be at the top end of market expectations, prompting Seymour Pierce to keep its 'outperform' stance on the stock.

Also rising after a trading statement Friday was Capital & Regional, 21p ahead at 356p. Earlier, the co-investing property asset manager said its underlying tenant facing business remains resilient with all indicators within their normal trading range and that its plan to raise new equity within its community shopping centres 'The Mall' has progressed well.

Ladbrokes gained 6.75p to 316.75p, as it announced profits from continuing operations, excluding high roller activity, increased 13% in the first four months of 2008.

On the downside, Rightmove was off 15.5p at 370.25p, as the group said it is to place up to 16.2 million shares via accelerated bookbuilding.

A broker downgrade left shares in Logica 3.5p lower at 124p, with Goldman Sachs lowering its recommendation for the group to 'sell' from 'neutral' while reiterating its 120p target price, following a recent share price rally.

Finally, JKX Oil & Gas shed 16.25p to 492.75p, after the company said Q1 production fell 15% to 11,494 barrels of oil equivalent per day.

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