REUTERS GROUP joined the FTSE 100’s rally to a five-month high, amid increased optimism that this month’s trading statement from the financial information provider will impress.

Two weeks ago, Morgan Stanley repeated its buy advice and 475p target in the belief that Reuters is enjoying a strong third quarter. With the company’s third-quarter results now less than two weeks away, ABN Amro has also taken the opportunity to push the shares and yesterday raised its target from 460p to 480p.

Paul Gooden, analyst, concedes that Reuters’ financial performance is being increasing decoupled from the investment banking cycle, as its business model moves away from a “bums on seats” basis. However, he suggests that recent employment growth in the sector can only be helpful.

Mr Gooden points out that investment banks are estimating an average 8 to 10 per cent increase in their headcount this year, and a 5 to 7 per cent increase next year.

With ABN Amro also expecting progress on Reuters’ Core Plus programme, the shares added 5¼p at 443p. The FTSE 100 rose 38.0 to 6,004.5.

Short-term investors who had bought Corus Group on the Tata Steel rumours congratulated themselves on their prescience — the Anglo-Dutch steelmaker rose 66¼p to 473¾p as Tata confirmed its interest. The hot-money focus shifted to BT Group, off 1p at 268½p, despite reheated, and rather improbable, talk of a tie-up with Deutsche Telekom.

British Airways faded 8¼p to 442p, hurt by a rally in oil prices back through $60 a barrel and a downgrade from buy to hold from Citigroup after Wednesday’s September traffic statics from the flag-carrier. Following a 35 per cent rise so far this year, Andrew Light, analyst, says risks remain, including a possible pilots’ strike over pensions and a “negative surprise” from the Office of Fair Trading and US Department of Justice’s cartel investigation.

GUS firmed 19p to 985p ahead of its last day of trading today before its demerger into Experian, the credit checking business, and Home Retail, the owner of Argos and Homebase, which both relist next Wednesday. Buyers were encouraged by talk that the £800 million fundraising for Experian, which will price after today’s close, is proceeding well, and reassuring comments from B&Q this week on a stabilisation of the DIY market, which should bode well for Homebase.

Marks & Spencer faded 2½p to 650p on vague rumours that Brandes Investment Partners, the US fund manager which holds about 9.7 per cent, was seeking to trim its stake once more. J Sainsbury was nudged up ½p to 390p, a new four-year high, ahead of Wednesday’s second-quarter trading update. Morgan Stanley expects the numbers to confirm the supermarket’s sequential progression towards its £2.5 billion three-year sales target.

AstraZeneca added 8p to £33.53, despite a study from Merck and Schering-Plough which they claimed showed their Vytorin treatment was more effective in lowering cholesterol than the Anglo-Swedish group’s Crestor.

• NEW YORK: The Dow Jones industrial average reached its third successive record close, adding 16.10 points to end at 11,866.70, as investors responded to positive retail sector figures.

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