London - Britain's top share index crept up on Tuesday, in cautious trade ahead of a European Central Bank policy decision this week, led by engineering firm Weir Group on an analyst upgrade.
The FTSE 100 was up 15.50 points, or 0.2 percent, at 6,840.81 points by 10:00 SA time.
Trading volumes were expected to be subdued in the first few hours of trade until Wall Street reopens following a Labour Day holiday.
Weir was the standout blue-chip gainer, up 3.1 percent, with traders citing the impact of a Credit Suisse recommendation upgrade to “outperform” from “neutral”, as it downgraded peer IMI to “neutral” from “outperform”.
“Weir end market exposure offers better chance for upside surprise. Our end market analysis suggests that 66 percent of Weir end markets could offer scope for positive surprise versus 0 percent for IMI,” Credit Suisse analysts said.
IMI shares slipped 0.5 percent.
Investors remained focused on European Central Bank policy after ECB President Mario Draghi's dovish speech at the gathering of central bankers at Jackson Hole, Wyoming.
This raised expectations the ECB is preparing to pump more liquidity into the system, possibly via purchases of government or corporate bonds, a measure known as quantitative easing (QE).
Sources within the central bank told Reuters last week that new action at its meeting this Thursday was unlikely but not impossible, and that the barrier to QE was still “very high”.
Joe Rundle, head of trading at ETX Capital, said: “I think the ECB are going to disappoint (at the meeting) so I think you're going to get a pullback as I don't think they're actually going to deliver anything concrete.”
“But (this) will then give a good entry point to get back involved (in the market).”
The FTSE 100 reached a peak of 6,894.88 points in mid-May, its highest in more than 14 years.
But it has not yet passed the 6,900 point mark, considered a major hurdle before it can challenge record highs around 7,000 points.
With Scotland set to vote on independence this month, investors are looking at the latest polls with interest, although the stock market has been shrugging off the impact of a potential break-up of the United Kingdom, preferring to wait to see the outcome.
Support for Scottish independence rose dramatically in August, a poll showed on Monday, leaving the “Yes” campaign just six points behind advocates of staying in the United Kingdom.
The poll is the first to show a substantial shift in opinion since two television debates.
Among midcaps, Redrow inched up 0.5 percent after its full-year profit nearly doubled, spurred by the government's “Help to Buy” housing scheme and strong consumer sentiment, allowing the British housebuilder to double its final dividend to 2 pence per share. - Reuters