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FTSE buoyed by mining stock strength

ROLLS-ROYCE was one of the biggest Footsie fallers after it emerged it was involved in a corruption investigation relating to overseas intermediaries.

The group spooked investors after it said it had passed information to the Serious Fraud Office on allegations of malpractice in Indonesia and China.

The shares closed 3%, or 28.5p, lower at 885p but the wider FTSE-100 index rose 9.3 points to 5901.4 as mining stocks were buoyed by hopes over progress to resolve America's looming fiscal cliff.

Optimism was high after President Barack Obama said a deal was possible within a week.

The pound was down against the US dollar at 1.60 amid higher hopes for avoiding the fiscal cliff on January 1, while sterling was up against the euro at 1.23.

In London, Eurasian Natural Resources moved 6.1p ahead to 283.3p and Antofagasta added 41p to 1337p.

Standard Chartered shares shrugged off confirmation that it expects to pay a total fine of £416 million to settle allegations that the bank breached sanctions with Iran.

The shares still firmed 12p to 1500.5p on hopes the agreement will remove uncertainty.

Elsewhere in the top flight, accountancy software firm Sage was under pressure for a second straight session after results yesterday showed slowing growth in parts of Europe. The shares fell 2%, or 6.4p, to 294p.

In the FTSE-250, Leeds-based electronic components firm Premier Farnell reported an 18% fall in underlying profits to £17.3 million in the third quarter. However, the shares rose 3%, or 5.6p, to 182.7p as analysts said its performance would start turning around soon thanks to cost- cutting efforts and easier comparatives.

Fellow FTSE-250 stock Dixons Retail was given a boost by a broker upgrade as Barclays said the demise of Comet would prove a game changer for the Currys and PC World parent firm. Shares in the group gained 1.1p to 27.6p.

Elsewhere, cinema chain Cineworld was in the spotlight after it announced a £47.3m deal to buy art-house chain Picturehouse. The acquisition will add another 21 cinemas and 60 screens to Cineworld's existing 80-strong chain. The shares rose 8.8p to 255p.

The biggest Footsie risers were Antofagasta up 41p at 1337p, Eurasian Natural Resources ahead 6.1p at 283.3p, Vedanta Resources up 24p at 1118p and Johnson Matthey ahead 48p at 2411p.

The biggest fallers were Weir Group down 64p at 1817p, Rolls-Royce off 28.5p at 885p, Pennon Group down 18p at 601p and Meggitt off 8.9p at 384p.

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