City Watch

Good news on inflation this week helped the FTSE-100 index of leading shares gain ground after recent heavy losses. By midday on Tuesday the main index was up 105.2 at 5572.4, following the trend set in Japan, where the Nikkei closed up 269 points. The Russian economic crisis prompted a 50% devaluation of the rouble […]

Good news on inflation this week helped the FTSE-100 index of leading shares gain ground after recent heavy losses.

By midday on Tuesday the main index was up 105.2 at 5572.4, following the trend set in Japan, where the Nikkei closed up 269 points.

The Russian economic crisis prompted a 50% devaluation of the rouble before London trading began, leading to fears that investors would switch from the closely-linked German mark into sterling, punishing British exporters again.

In early trading the pound gained half a pfennig to just over 2.9 marks.

Engineering shares were mixed, many having suffered significant losses over the past few weeks.

BTR lost 4.5p to 160.5p amid continued speculation of interest from corporate raider Kohlberg Kravis Roberts.

Senior Engineering rose 6p to 184.5p after unveiling plans to boost capital expenditure at its US aerospace components subsidiary Ketema.

Elsewhere, British Aerospace was up 24p to 417p, following an upbeat ‘buy’ recommendation from Credit Lyonnais Securities.

AEA Technology was another climber, up 44p at 865p after buying engineering consultancy Transport Consultants International.

Among smaller stocks, toolmaker Polyhedron Holdings saw its share price jump 21.5p to 66p after confirming that it had received a bid approach.