Banks are boosting the market again, with continuing speculation of a possible bid for Alliance & Leicester and a decent set of full year results from Standard Chartered.
So after yesterday's 111 point rise, the FTSE 100 has jumped above the 6000 level and is now sitting at 6064.9, up 65.4 points. A&L is 28.5p higher at 583.5p, with talk of interest from Lloyds TSB refusing to die down.
Standard Chartered has added 106p to £16.85 after a forecast beating 27% rise in 2007 profits. The company, often tipped as a takeover target, said this morning it was open to making acquisitions itself.
On the retail front, the CBI reported worse-than-expected high street sales figures, showing a fall in February rather than a rise. But the survey also indicated that shop owners were still hoping to raise prices - the level was the highest since 1996 - and this is likely to count against an interest rate cut when the Bank of England comes to make its next decision.
James Knightley at ING said: "The survey suggests the bounce in official retail sales last week was a blip. A net 3% of retailers are now seeing sales falling. This is the worst reading since November 2006 and is well down on the January reading which showed that a net 4% were seeing higher sales.
"However, the Bank is unlikely to come to the rescue in the near term with the inflation components showing firm rises. Indeed, selling prices are running at the fastest rate since August 1996, and retailers expect to continue to up prices. As such, the BoE is likely to remain on a gradual easing path, but come the second half of the year, we suspect the weaker growth backdrop will have eased inflation worries somewhat. We continue to look for rates to be cut to 4.50% by year-end."
Still with retail, Marks & Spencer dipped 1.25p to 408.25p as Seymour Pierce downgraded from hold to sell. It said: "We believe that the fashion retailer sub-sector is having a tough time at present and expect M&S to suffer from this. With earnings growth stalled, 2009 forecasts at risk and the challenging March/April comparatives, we move our recommendation to sell."
A downgrade also did for British Gas owner Centrica, down 5.25p to 323.25p as Lehman Brothers moved from overweight to equal weight and cut its price target from 400p to 390p.
Lehman said: "We have updated our forecasts for 2007's full year results, resulting in additional 5-8% cuts to earnings that had only a week earlier been cut by 8-9%. Thus in the space of a week we have cut the bottom line for 2008 and 2009 by 15%.
"Management's apparently stronger commitment to upstream investment means we can no longer justify our previous £1bn share buy-back assumption."
Elsewhere SCi Entertainment, the struggling computer games group where entrepreneur Robert Tchenguiz holds a stake, jumped 24.5% to 57p on revived takeover speculation. The latest impetus seems to be an unsolicited $1.9bn bid for rival Take-Two from US giant Electronic Arts.
Meanwhile SCi, which announced last month that bid talks had collapsed, is due to announce the outcome of a business review on Friday.
