Gem sparkles as diamonds are a broker's best friend

Instead, they were being drawn by the attractions of Gem Diamonds amid hopes its focus on bling will pay off. The miner stands apart from its peers by having a bigger share of the market for diamonds above 10.8 carats, known as "specials".

According to Goldman Sachs, with emerging markets rapidly developing a taste for luxury goods - such as jewellery - this will be one area in the diamond market that will suffer from a particular tightness in supply.

As a result, analysts from the broker upgraded their advice on Gem to "buy", as they also praised the growth potential of its Letseng mine in Lesotho.

The gossips, meanwhile, were continuing to push vague speculation that Gem could become a takeover target, citing its cheapness after its share price lost more than a third since February. There has been speculation recently that diamond retailer and stakeholder Laurence Graff could be tempted into an approach, although dealers were unconvinced.

Has the "Santa rally" finally turned up for the FTSE 100? The benchmark index jumped higher for the second consecutive session, rising 19.7 points to 5439.3, although it has still lost ground over December despite being a traditionally strong month.

The availability of three-year loans from the ECB for the first time meant banks were dashing ahead.
Royal Bank of Scotland advanced 0.8p to 20.5p and Barclays was 6.05p stronger at 177.5p, although neither were as strong as Lloyds Banking Group which climbed 1.2p to 24.8p after getting an extra boost from Exane BNP Parbias. The French broker's analysts raised their advice by two notches, from "underperform" to "outperform", saying Lloyds' sell-off "discounts too much risk".

HSBC ticked up 11.2p to 495.1p as it agreed a deal to sell its Japanese private banking unit to Credit Suisse - the latest in a run of disposals as the group reshapes its operations.

Beazley has decided on another tilt at gobbling up rival Hardy Underwriting. The Lloyd's of London insurer - which rose 1.8p to 135.7p - had three bids rejected last year but has now announced it is trying again, pushing the small-cap group up 19p, or 10.86%, higher to 194p.

Kurdistan was again a major area of focus for the oil groups, this time concerning Genel Energy. The explorer, headed up by former BP boss Tony Hayward, eased back 2.5p to 790.5p after announcing it was in talks with Canada's Longford Energy over potentially increasing its stake in the region's Chia Surkh oilfield to 60% from 20%.