Vodafone helped the FTSE 100 index to break a five-day losing streak on hopes that it will secure exclusive rights to the iPhone. Apple is set to make its keenly awaited anticipated entry into the mobile phone market next week, having signed a five-year exclusive deal with AT&T in the United States. Analysts believe that an announcement on European partners may come in July, with Vodafone said to have edged in front of Deutsche Telekom for a deal.

Credit Suisse reckoned that the victor would sell more than six million handsets inside three years. For Vodafone, that could be worth 8p per share. “Apple is keen to protect the value of the iPod by ensuring iPhones are not sold with a subsidy,” it told clients. “Vodafone would appear the front-runner, able to offer a presence in most European markets.”

Vodafone closed up 1.6p at 157.6p – also helped by bullish research from Sanford Bern-stein, which raised its 12-month price target to 240p.

The upgrade was based on guidance that Vodafone would be able to sell its 45 per cent stake in Verizon Wireless without incurring capital gains tax and that its management expects to receive dividends from the American joint venture within the next two years. Either a tax-free exit or a dividend stream raised Bernstein’s per-share valuation by 20p; the correction of a double-counting error on its spreadsheet added the same again.

The wider market bounced in tandem with Wall Street, with the FTSE 100 up 21.0 points to 6,588.4.

Sainsbury was the day’s main speculative feature, rising 10p to 582½p on a tale that its founding family had disposed of part of its 18 per cent holding at 610p a share and that a bid approach from Delta Two was imminent. City sources dismissed the first rumour as nonsense and remained in the dark about the Qatari fund’s intentions.

There was another airing for rumours of private equity interest in Tate & Lyle, which put on 13p at 572½p to lead the blue-chip risers. Others saw the gain as more to do with short-covering as the sugar refiner’s shares tested the lower reaches of their 18-month trading range.

There was a similar range of explanations for the move in Forth Ports, up 84p to £18.46. Although the group is regularly considered a break-up candidate because of its property assets, dealers said it was more likely that the shares were rebounding off nine-month lows.

Miners had been the main drag on the blue-chip FTSE earlier as Cazenove cut recommendations on Anglo American, off 42p at £29.95, and Antofagasta, down 10p to 608½p. While it kept an “overweight” view on the sector, it argued that both were looking expensive against the likes of BHP Billiton, up 15p to £13.90.

Enterprise Inns was up 12½p to 686½p. The pubs group had been weak on Friday after tax experts saw its attempts to form a real estate investment trust as unlikely to succeed. However, Citigroup argued that the shares were still worth a punt: success would add 60 per cent to its valuation, while there was just 10 per cent potential downside because of a planned £1 billion share buyback, it said.

Among the mid-caps, HMV rose 4p to 123¼p ahead of its results on Thursday as speculation about the sale of its Japanese division encouraged short-sellers to cover positions.

Ryanair added 11½ cents to €5.02½ on talk that it had started a share buyback programme. Accompanying a profit warning from the budget airline this month was news that it would spend up to €300 million (£200 million) on share repurchases, equivalent to about 4 per cent of its market capitalisation. C&C Group, the maker of Magners and Bulmers ciders, slipped 40 cents to €10.73 on the fear that the miserable start to summer was dampening demand.

— New York: Wall Street gave up a big advance and turned lower as investors suffered a renewed case of the jitters ahead of the Federal Reserve’s meeting on interest rates this week. Shares were up 123.70 points at midday, but closed down 8.40 at 13,352.00.

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