Blue chips reverse early losses to finish up

UK stocks advanced after suffering losses in early trade this morning.

The benchmark FTSE 100 gained 102.75 points to close up at 5,198.32, while the broader FTSE 250 also rose by 26.25 to 8,433.61.

Earlier in the day financials were hit by Jason Napier of Deutsche opting to downgrade its recommendation for Lloyds TSB stocks from hold to sell.

Among the largest rises of the day was for RSA Mutual, which was buoyed by speculation that French insurance giant Axa is mulling a takeover.

Meanwhile, other gainers in the top ten included Old Mutual, Babcock & Brown, Aviva and Legal & General, with insurers have been sent up further by Axa recording better than expected results.

Conversely, Superglass lead the fallers, with Bradford & Bingley, Collins & Stewart and Laura Ashley in second, third and fourth place respectively.