Still with insurers, Prudential is 19.5p higher at 659p with a reasonable amount of volume, as vague bid rumours re-emerge.
Earlier this month it was suggested that China's Ping An Insurance - which is raising a $17bn (£8.5bn) warchest - was interested in the Pru.
Ahead of the Budget, the FTSE 100 has slipped back a little, but is still 89.4 points higher at 5779.8. The central bankers' action yesterday to inject $200bn liquidity into the system seems to have calmed investors. But should this be the case? Three month sterling Libor - the rate at which banks lend to each other - edged up today from 5.791 to 5.8, despite the banks' intervention.
And a number of commentators - here and here for example - believe the Fed and its colleagues could just be rearranging the decks on the Titantic.
And in a note entitled Cough syrup for a case of pneumonia, Panmure Gordon banking analyst Sandy Chen writes the following:
" With the S&P 500 up 4%, and US financials up 7% on the back of the US Fed announcement of a US$200bn Term Lending Facility (similar to the ones announced
months earlier by the Bank of England and ECB, and following the Fed's US$200bn liquidity injection last Friday), it may be tempting to call the bottom for UK banks' share prices, on the view that what economist Paul Krugman has called the Fed's "slap in the face" - to bring the markets back to its senses - will bring liquidity back overall.
"We don't think it will prove sufficient. The US$200bn (and reportedly more if
needed) in Fed lending for banks, available against AAA-rated mortgage-backed securities, is dwarfed in comparison to the US$11 trillion in US residential mortgages outstanding. Given the house price falls in the US that are expected to continue well into 2009, there is a substantial risk of negative equity on a substantial portion of those mortgages - especially on the US$2-3 trillion of sub-prime, near-prime and Alt-A/jumbo mortgage."
