LONDON (ShareCast) - Though most banks remain mired deep in the red, the rest of market is staging a recovery, led by commodity plays.

Even banks are paring earlier losses, though Royal Bank of Scotland remains under pressure following the downgrade in its credit ratings by Standard & Poor’s yesterday.

Bank prices have perked up on reports that a multi-billion pound rescue package for British banks is expected within days following chancellor Alistair Darling’s meeting last night with banking chiefs and central bank governor Mervyn King.

Politicians urged the government to rush through a recapitalisation plan that would cost UK taxpayers around £50bn, but give them stakes in a number of high street banks.

Hedge fund manager Man Group has also recovered its poise after yesterday’s heavy fall.

Miners lead the fight-back as metal prices recover. Vedanta and ENRC are the picks of the sector while Rio Tinto, which has significant interests in Australia, is also wanted.

Kazakhmys defies the trend, however, slipping back after the company signed a memorandum of understanding with Samruk-Energy that will see the pair consider a strategic partnership and joint ownership of the Kazakhmys Power division.

British Airways is lower after it said its merger with Spanish airline Iberia will be delayed by the continued economic slowdown in Britain and the USA.

Michael Page saw third quarter profit rise 14.6% to £141.4m, but the recruitment firm warned it will axe more staff during the final quarter of the year if market conditions continue to deteriorate.

Ready meals group Northern Foods said although profits are weighted more towards the second half, at the half way stage, it remains on schedule to deliver pre-tax profits in line with expectations.

Yellow Pages publisher Yell has agreed an amendment to its bank covenants with major banks that gives it more flexibility in tough conditions.

Terrestrial TV network ITV has plunged after Swiss bank UBS reiterated its sell rating and cut its 12-month price target to 25p from 28p. UBS said that after stripping out the content business, the shares are trading on “56 times 2009 earnings, more than pricing in an uncertain recovery and regulatory benefits.”

Although UBS acknowledges the possibility of a bid it does not think any offer will emerge until “the share price catches up with the economic reality.”

Sausage maker Cranswick's like-for-like sales rose by 10% in the half year to September with higher selling prices offsetting raw material increases.

Weak trading in the US and Asia mean that Kewill’s pre-tax profits in the second half will be lower than those of the first six months of the year, the logistics software company warned.

Road and infrastructure support group Mouchel has reported a 20% hike in profit before tax and one-off items and full year underlying revenue growth at the top end of its 10-15% target.

Shares in Oxford Biomedica surged ahead after positive talks with the US Food and Drug Administration (FDA) on further trials for its renal cancer drug TroVax.

Mobile phone software specialist Psion said it will make a full provision in its 2008 accounts for claims made against it from trading partners of its Japanese arm Psion Teklogix KK (Psion Japan).

UK catering equipment maker Enodis is firmer after its takeover by The Manitowoc Company obtained US antitrust clearance.

Shares in Your Space slumped after the office space and building restoration firm reported sharply lower full-year profits.

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