LONDON (ShareCast) - London is still healthily in the blue though off its best as the banks and housebuilders stage a decent rally.

Barclays, Royal Bank of Scotland, Lloyds TSB and Standard Chartered are all posting big gains after unexpectedly strong results yesterday from the San Francisco-based bank Wells Fargo and investment bank JP Morgan today.

Fund manager Schroders rises after acquiring a foothold in Taiwan through the purchase of an investment trust. Schroders is paying £8.6m for E.Sun Securities Investment Trust, a company that has a Securities Investment Trust Enterprise (SITE) licence that will enable Schroders to establish an onshore investment capability in Taiwan.

Hotel and pub groups, such as InterContinental Hotels, Whitbread, Punch Taverns and Enterprise Inns are also higher after a positive Tempus article in The Times on pub groups.

Oils and miners are the major flies in the ointment as they track commodity prices lower.

Cable and Wireless advanced after Lehman Brothers has lifted its rating on the telecoms group to "overweight" from "equal-weight" and raised its target price to 200p from 190p.

In other broker coverage, SG Securities has downgraded its rating on British Land to "hold" from "buy" as part of a review of European real estate companies.

Travel companies TUI and Thomas Cook receive a boost from Morgan Stanley, which recommends its clients be overweight in both stocks.

Housebuilders are wanted after UBS upgraded Persimmon, Redrow and Bellway from “sell” to “neutral”, while Berkeley Group is upgraded to a “buy”.

Retailer Kingfisher rose after it announced the appointment of DSG's finance director Kevin O'Byrne, who will succeed Duncan Tatton-Brown, from 1 October 2008. DSG said Nicholas Cadbury will be appointed finance director with effect from 14 August.

Aero engine giant Rolls-Royce is up on reports that it is to expand its nuclear business. Also today, it said orders from leasing companies AWAS and LCAL for Trent engines will be worth nearly $400m.

Cathedral City cheese group Dairy Crest has started its new financial year in line with expectations, with price hikes helping to offset rising commodity costs. The firm kept its forecasts for the full year unchanged as it reported good brand growth and a 14% increase in sales at the foods division during the three months ended 30 June.

Mothercare saw total group sales rise 20.7% in the first quarter. UK like-for-like sales in the period rose 1% with total UK sales up 19.5. The group said Direct in Home sales surged 77.7%.

Emerging markets fund manager Ashmore saw assets under management leap by $1.2bn, or 3%, in the fourth quarter, taking the total for the year up 19% to $37.5bn. The 3% increase during the three months ended 30 June was made up mostly of local currency and dollar debt, said the UK mid-cap.

Fund manager Rathbone Brothers has agreed in principle to offload its offshore trust businesses in Jersey and Singapore to management and private equity firm Dunedin.

Outdoor clothing retailer Blacks Leisure said its cost savings programme is ahead of schedule and boosting pre-tax profits despite a dip in sales.

Online marketing specialist TMN Group said takeover talks with August Equity LLP have been terminated after the fund advisor failed to secure "sufficient" third part debt financing to support an offer.

The chief development officer of Meldex International is considering a buy-out of the company.

Shares in semiconductor wafer specialist IQE climbed after the company said its strong trading patterns continued in the second quarter.

Trinity Mirror maintains its rally after it said yesterday it is trading comfortably within the covenants for its debt facilities.

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