London - Britain's top share index rose to a five-month high on Monday, led by temporary energy provider Aggreko, with broader sentiment towards equities lifted by U.S. indexes hitting record highs on Friday.
The FTSE 100 was up by 11.30 points, or 0.2 percent, at 6,732.64 by 10:20 SA time, after the S&P 500 ended last week at another record high, boosted by gains in technology shares after strong results from Microsoft and Amazon.com.
The gains took the UK's top share index to a five-month peak, leaving it just 1.5 percent off the 13-year closing high set in May.
“With the strength that we're seeing in the US, and the fresh all time highs we keep seeing on the S&P 500, it wouldn't be ridiculous for the FTSE to be dragged up back to those May highs,” David Jones, chief market strategist at IG, said.
Reflecting global appetite for shares, investors poured record amounts of new money into equity funds in the seven days to October 23, EPFR data shows, with EPFR global-tracked equity funds taking in their third-highest weekly total so far in 2013.
Aggreko gained 5 percent after the temporary energy provider said it expected underlying revenues and margins to be ahead of the prior year both in the second half and on a full-year basis.
Traders said that although the figures were in line with expectations, it was being squeezed higher as people took off “short” bets on future falls in the share price.
To short a stock, traders take it out on loan and sell it, then buy it back later.
If the stock has fallen in the interim, they make a profit.
For Aggreko, 25 percent of all the shares available to be loaned out had been loaned, according to Markit data, leaving room for a spike as investors bought back the shares to take their bets off.
Just behind Aggreko on the FTSE leader board was Shire , which rose 3.2 percent after benefiting from an increased price target from Citigroup, helping the healthcare sector add 5.3 percent to the index - the biggest sectoral riser.
The biggest weight on the index was the energy sector, which was led lower by Tullow Oil, down 1.5 percent after suspending drilling operations on two blocks in northwest Kenya due to security concerns. - Reuters