Better than expected results from Sky and chip designer Arm, plus a smattering of takeover talk, helped push leading shares higher for the second day in a row, although mining shares proved a drag on sentiment.
Sky ended 53p higher at £11.05 - the biggest riser in the FTSE 100 - as profits and subscriber numbers beat forecasts, while Apple supplier Arm also impressed with its figures, adding 45p to £11.95.
InterContinental Hotels ended 94p higher at £28.80 on continuing speculation of a possible bid from a US peer.
Johnson Matthey added 49p to £34.94 amid talk it was one of a number of parties interested in Swiss chemicals company Clariant.
Overall the FTSE 100 ended 10.80 points higher at 7062.93, although it was off its best level of the day of 7105 as the concerns about a Greek default and exit from the eurozone continued to unsettle investors.
There was also some nervousness ahead of a number of key events on Wednesday.
Tony Cross at Trustnet Direct said:
Full year numbers from Tesco will be front and centre [on Wednesday morning} - the market will be bracing itself for a write down but the exact size of the hit will dictate where the stock comes out of the auction. We’ve also got Bank of England meeting minutes and some eurozone consumer confidence data, although any word on the next steps for Greece will be under the greatest scrutiny. Suggestions that the European Central Bank will now start reigning in support for the country’s banks really does paint a bleak picture.
Miners suffered some profit taking after Monday’s gains on the back of the weekend’s move by Chinese authorities to cut their banks’ reserve requirment ratios in an effort to boost the country’s flagging economy. With disappointing production figures Rio Tinto lost 62p to £28.12 while BHP Billiton fell 18.5p to £14.63 and Anglo American dropped 21p to £10.17.
Associated British Foods fell 151p to £27.12 after disappointing results, while among the mid-caps Petrofac fell 38p to 874.5p after Monday’s profit warning related to its North Sea assets.
