FTSE modestly higher early on in light pre-holiday trade

MORNING REPORT: Headline shares were modestly higher in early deals today, although activity was limited ahead of the long holiday weekend, with unsolicited interest in BP's 50% BP/TNK stake the big news.

In early trade, the FTSE100 was up 25.58 points at 5,346.44 with the FTSE250 off 14.3 points at 10,542.9 and the FTSE Smallcaps slightly lower at 2,906.83.

US & ASIA

In the US last night, the Dow fell 26 points at 12,393, the Nasdaq lost 10 points at 2,827 and the S&P500 shed 3 points at 1,310.

In Asia today, the Nikkei closed down 102 points at 8,440, while the Hang Seng was recently ahead 20 points at 18,650.

LONDON MARKETS

Activity was slow this morning as many investors made an early start to the long Bank Holiday weekend. Disappointing economic data from the US and reports of slowing manufacturing in China dampened enthusiasm this morning, exacerbated by the BCC lowering its UK 2012 GDP growth forecast from 0.6% to 0.1%.

Financial issues made a positive start today, with hedge fund manager Man Group topping the leaderboard with a gain of 3.03p at 75.93p. The group is tipped to drop out of the blue chip index at the June review, with engineer Babcock the favourite to replace it.

Bank made modest progress, with Barclays the best of them, up 2.53p at 178.83p. Lloyds added 0.29p at 25.67p and Royal Bank of Scotland ticked up 0.23p at 20.21p.

Car insurance specialist Admiral rallied 15.5p at 1,054.5p as investors considered yesterday's tumble overdone.

Oil major BP was a major gainer after it said today it wants to sell its 50% stake in Russian joint venture TNK-BP, estimated to be worth up to $20bn. The oil producer said it has received unsolicited interest in the holding. BP shares jumped 15.25p at 410.15p on the news.

Miners put in a cagey performance, with Rio Tinto up 15p at 2,795p and BHP Billiton ahead 14.5p at 1,709p the pick of the crop. Telecoms giant BT Group ticked up 1.4p at 207.7p after it confirmed it has sold its French application development services business to Paris-listed Osiatis.

Other notable gainers included global brewer SABMiller, up 22.5p at 2,417.5p, explorer Tullow Oil, ahead 18p at 1,440p, and cigarette maker BAT, 7p better at 3,065p.

On the downside with blue chips, ex-dividend factors took their toll, with industrial pump manufacturer Weir Group down 22p at 1,522p, chemicals group Croda International off 34p at 2,202p, and InterContinental Hotels Group, 9p lower at 1,518p.

Defence contractor BAE Systems lost 0.65p at 272.15p following yesterday's news it is closing its plant in Newcastle with a loss of 600 jobs.

Retailers struggled to keep the tills ringing, with luxury brand Burberry down 5p at 1,362p, DIY specialist Kingfisher off 3.5p at 278.5p, and frock shop chain Next 7.5p lower at 3,021.5p.

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