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LONDON (AFX) - UK blue chips extended their gains midmorning, as selected TMTs benefited from weekend press reports and Nasdaq's relatively strong performance on Friday and with disposal news boosting Invensys by nearly 7 pct, dealers said.
At 10.11 am the FTSE 100 index was up 50.7 points at 4,380.7, while all the wider indices had moved into positive territory.
Volumes were seasonally quiet with 330.9 mln shares changing hands in 21,663 deals.
At the close on Wall Street last Friday, the DJIA ended the week 40.08 points lower at 8,778.06, while the Nasdaq composite index closed 16.00 points higher to end at 1,361.01.
With no key UK data released today, the latest US Leading Indicators should attract interest this afternoon.
In London this morning, the media sector was in the spotlight ahead of tomorrow's first half numbers from WPP Group and amid news of a deeper collaboration between ITV shareholders, Granada and Carlton.
WPP Group fell 8-1/2 to 452-1/2 amid expectations that the group will report a sharp fall in its six months profits due to the depressed advertising market.
Investors will be looking tomorrow for any clues on the outlook for the advertising market following recent downbeat comments from all the major advertising agencies, including Omnicom, Publicis and Havas.
Sector watchers also hope to find out more about expansion plans at the acquisitive group, with recent talk suggesting the firm is eyeing a possible bid for second liner Chime Communications.
In contrast, Granada marched up 5-1/4 pence to 80 and Carlton gained 7-3/4 at 136-3/4 after Carlton's chief executive, Gerry Murphy, told the Financial Times the two groups are to combine large parts of their operations in an attempt to win back advertisers and viewers and cut costs.
Murphy told the FT the two groups are trying to manage a "virtual enterprise".
Fellow ITV stakeholder SMG climbed 1 higher to 94-1/2 after reports in the weekend press that both Granada and Carlton have been in discussions regarding the sale of its television business.
Elsewhere in the media sector, rose 6 to 267 on speculation that it is to win a 1 bln usd contract from Merrill Lynch following a report in the Sunday Telegraph.
In corporate news, Invensys was the best performing blue chip in midmorning trade, with the shares moving up 4-1/4 to 65-3/4 after the international production technology and energy management group agreed to sell its Invensys Sensor Systems business to Honeywell for 394 mln usd net.
Meanwhile, Rolls-Royce moved 1/2 pence higher to 128-1/2 ahead of its interim figures on Thursday.
Recent worries for analysts have centred on a possible under-funding of Rolls-Royce's pension scheme, but the first half numbers are expected to reopen concerns about the blue chip firm's overall financial strength.
Among technology stocks ARM added a further 10-3/4 pence to 177, buoyed by a strong US chip sector on Friday and hopes of a return to the FTSE 100 index at the next reshuffle in September.
Sage shares however, fell back, losing 1/4 pence to 126-3/4, after UBS Warburg cut its target to 155 pence from 225, although maintained its 'buy' recommendation.
Spirent suffered a similar fate, dropping 2-3/4 pence to 67-1/4, after UBS Warburg downgraded the stock to 'reduce' from 'hold' and cut its target to 55 pence.
In the retail sector, department store group Arcadia Group added 45-3/4 pence to 346-1/2 amid investors' relief that the group rejected a 365 pence a share approach from Bhs owner, Philip Green.
Retail analysts pointed out that although Green's 365 pence proposal represents a 21 pct premium to Arcadia's closing share price on Friday of 300-1/2 pence, it is well below its 2002 peak of 417 pence.
Remaining among second liners, recruitment giant Michael Page jumped 11 pence to 131 after posting in line first half pretax profits and revealing it is to buy back up to 40 mln stg shares over the next 12 months.
Looking forward, the group said it sees trading conditions being "challenging but stable" for the rest of the year.
Among small cap issues, fallen tech star Kewill Systems dropped 4 pence to 14-3/4 after issuing a cautious trading statement, saying it expects a material operating loss for the six months to Sept 30.
Moreover, it said that while it sees an improvement in second half trading, it will not be enough to offset first half losses and therefore it may not achieve an operating break-even position for the year as whole
Meanwhile embattled telecom equipment maker Marconi tumbled a further 1.02 pence, or 40 pct, to 1.5 pence after a report in the FT painted a glum picture for shareholders in the outcome of negotiations between the group and its creditors.
The newspaper said Marconi itself is understood to be keen to hand a small stake, perhaps 1 pct, to its equity holders. But creditors facing significant losses of well over 1 bln stg are said to want to leave them empty-handed.
Elsewhere, CH Bailey slumped 2-1/4 to 3 after resuming trading today following its full year results on Friday when the group reported a swing into the red and said it was omitting to pay a final dividend.
A profits warning knocked a 0-1/4 penny off shares in Protagona.
In contrast, Galleon Holdings put on 1/4 to 1-1/2 in response to the licensing deal with Garry Kasparov, the world's number one ranked chess player.
Systems Union Group was also well bid after it reported a 162 pct leap in first half EBITDA, boosted by increased revenues, tight cost controls and improved productivity. Shares in the group were up 2-3/4 at 30-1/2.