Market Round Up: Admiral steadies the ship after its long spell of rough sailing

Ever since the profits warning last November, which knocked its share price back by more than 25% in just one session, there has been little news from the group, creating a swell of negativity in the Square Mile over its prospects
Yet its announcement today that it had extended its current reinsurance partnerships for its motor insurance business at no increase to costs saw it shoot up 8%.

It is hardly earth-shattering news normally, but Admiral still jumped 79p to 1,040p. City voices said the news was a major tonic for the negative sentiment around the sector and Admiral in particular.

"It won't make any difference to forecasts, but you can take from it confidence in Admiral's abilities to make underwriting profits," said Collins Stewart's Ben Cohen.

The analyst also pointed out an encouraging read-across from the world's largest reinsurer Munich Re, which yesterday bullishly predicted an increase in premiums of 350 million (£290 million) over the year.

With Admiral having a major relationship with Munich, Cohen calculated this would translate into a 6% rise in UK profits this year, which prompted him to raise his price target to 975p from 880p.

After closing above 5800 points last night for the first time for more than six months, the FTSE 100 climbed 23.71 points to 5819.78, extending its winning run to a fourth session.

After yesterday's excitement, sparked by the news that a merger between Glencore and Xstrata looks finally on course to become a reality, the mining stocks were largely taking a breather, with the two edging down 2.2p to 459.48p and 6p to 1224.75p.

However, Anglo American, which many believe could become a target for "Glenstrata", managed to advance 22p to 2853p.

The news that it had managed to agree two production-sharing deals with the Ugandan government helped Tullow Oil spurt up 32p to 1472.5p, with the path now clear for the explorer to complete farm-down agreements with Cnooc and Total.

In the wake of yesterday's announcement that the retailer's boss Kate Swann had sold over £2 million of her shares, WH Smith declined another 2.5p to 534.25p.

The suggestion doing the rounds was that Swann was putting the money towards a house, although some wags were wondering, with fellow directors Neil Monnery and Stephen Clarke having also made significant stocks disposals in the past few days, whether all three were planning to move in together.

The rumour-mill around Misys has been rather busy in recent weeks, and today the software firm revealed it was in merger talks with Swiss rival Temenos. Yet investors were not happy about it being an all-share proposal and left the group 3.6p weaker at 321.9p.

It is certainly interesting timing. Next week is when US payment-processing firm Fidelity National Information Services is allowed to make another approach, after abandoning a £1.4 billion bid last August, and vague speculation it could return is refusing to die.