London close: IAG gains, Tesco drops

The top flight index ended the day 22.81 points higher at 6,855.64 points.

Economists expect little volatility as a result of elections

Ironically, Greece's electoral result meant that for now the worst political scenarios in the Mediterranean country has been avoided, although not all observers were altogether convinced.

Most economists were optimistic that the fall-out from the political situation in Greece would be limited.

However, Azad Zangana, senior European economist and strategist at Schroders, commented:

“Compared to when the European sovereign debt crisis first started, the markets’ contagion risk has been dramatically reduced.

“The Spanish version of Syriza – Podemos - is currently polling in second place ahead of the elections due by December this year. If an anti-austerity party was to take power in the Eurozone’s fourth largest economy, then the risk of a full-blown political crisis could seriously impact European markets.”

The yield on Greek 10-year sovereign bonds finished higher by 68 basis points higher at 9.12%, near its worst levels of the session.

Commodities take a hit, iron ore down

Market participants deemed that there was still scope for China’s largest export market to be impacted, which weighed on copper futures.

Analysts also cited the prospect for lower steel output ahead of the Chinese Lunar New Year celebrations as potentially leading to excessive stocks of iron ore.

By the close front month Brent crude futures had recovered from earlier losses to rise by 0.3% to $48.93 per barrel on the ICE.

Speaking on Saturday at the World Economic Forum in Davos, Switzerland, Bank of England Governor Mark Carney said markets may be underestimating for how long oil prices might stay low - thanks to the on-going technology revolution in energy.

German business sentiment rises for a third month

The German IFO institute's widely-followed gauge of business confidence, for the month of January, edged slightly past forecasts, rising for a third consecutive month to a level of 106.7 from 105.5 in the month before.

The Munich-based think-tank said: “Companies were far more satisfied with their current business situation and the majority was also optimistic about the business outlook”

Tesco smacked lower by Capita Dividend Report

The publishing of the Capita Dividend Report on Monday damaged Tesco and Morrison shares. Nicla Di Palma, equity analyst at Brewin Dolphin said: “We do not believe dividends are safe at any of the UK supermarkets.”

London Stock Exchange traded higher after analysts at RBC Capital lifted the group’s target price from £21.50 to £25.00 in a research note released on Monday morning.

IAG, the owner of British Airways, will reportedly announce that Irish airline Aer Lingus has accepted its recent takeover bid. The Irish carrier confirmed on Sunday that it was considering a new offer of €2.50 per share in a move which values it at €1.3bn. The FTSE 100 group may, however, face difficulties getting Irish officials to agree to the takeover.

Rolls-Royce has been awarded a contract to supply engines for major Chinese locomotive manufacturer CNR Dalian, marking its entry into that country's market for freight locomotives for export. The British engineer is to deliver 232 of its MTU Series 400 engines to CNR, the most powerful ones in that model series. They will be used in Transnet Freight Rail's new locomotives which the South African operator is in the process of upgrading.

Energy supplier SSE has announced a 4.1% cut to its gas prices from 30 April and said its full-year results would be in line with expectations but warned of continuing challenging business conditions in its new financial year.

Diamond mine operator Petra Diamonds saw sales jump by 16% in the first six months of the year, to reach $214.8m, but warned that it may not meet analysts' expectations for full-year profits. The miner's increased sales in the period were in part thanks to the sale of two exceptional diamonds for a combined revenue of $38.7m.

Executives at Aveva are finding it hard to see through the debris left behind by the oil price collapse, the company said on 26 January. In a trading statement covering the period between 1 October of 2014 and 23 January of 2015 the engineering and design technology company said that: "We are experiencing increased uncertainty and reduced visibility in the oil and gas market". That segment accounts for 45% of the firm's revenues.

techMARK 3,082.60 -0.27%
FTSE 100 6,852.40 +0.29%
FTSE 250 16,470.52 +0.07%

FTSE 100 - Risers
BG Group (BG.) 917.60p +2.90%
International Consolidated Airlines Group SA (CDI) (IAG) 549.00p +2.43%
Mondi (MNDI) 1,178.00p +2.43%
Royal Mail (RMG) 451.30p +2.34%
Ashtead Group (AHT) 1,118.00p +2.29%
Persimmon (PSN) 1,562.00p +2.29%
Schroders (SDR) 2,919.00p +2.24%
Antofagasta (ANTO) 697.00p +1.83%
Experian (EXPN) 1,181.00p +1.64%
SSE (SSE) 1,516.00p +1.61%

FTSE 100 - Fallers
Coca-Cola HBC AG (CDI) (CCH) 1,076.00p -3.24%
Tesco (TSCO) 230.00p -2.25%
Babcock International Group (BAB) 1,034.00p -1.80%
BAE Systems (BA.) 512.00p -1.35%
BT Group (BT.A) 426.00p -1.18%
Morrison (Wm) Supermarkets (MRW) 196.90p -1.10%
Reckitt Benckiser Group (RB.) 5,500.00p -1.08%
Aggreko (AGK) 1,527.00p -1.04%
CRH (CRH) 1,663.00p -1.01%
Barclays (BARC) 240.75p -0.99%

FTSE 250 - Risers
Zoopla Property Group (WI) (ZPLA) 169.50p +9.35%
Indivior (INDV) 175.10p +5.74%
Just Eat (JE.) 371.60p +4.71%
Ophir Energy (OPHR) 136.30p +4.20%
Euromoney Institutional Investor (ERM) 1,097.00p +3.78%
Galliford Try (GFRD) 1,324.00p +3.28%
Petrofac Ltd. (PFC) 698.00p +3.25%
AO World (AO.) 297.50p +3.19%
PayPoint (PAY) 914.50p +2.75%
Amec Foster Wheeler (AMFW) 829.00p +2.73%

FTSE 250 - Fallers
Afren (AFR) 17.67p -10.53%
Vedanta Resources (VED) 391.10p -9.05%
Petra Diamonds Ltd.(DI) (PDL) 165.20p -8.48%
Telecom Plus (TEP) 982.00p -5.39%
Acacia Mining (ACA) 280.00p -3.75%
Daejan Holdings (DJAN) 5,555.00p -3.73%
Hunting (HTG) 443.40p -3.69%
Entertainment One Limited (ETO) 268.40p -3.59%
NMC Health (NMC) 479.00p -3.19%
BlackRock World Mining Trust (BRWM) 302.90p -3.17%