Morning Market: US Fed chair's comments steady markets

Comforting words on the US economy and the eurozone from US Federal Reserve chairman Ben Bernanke and renewed activity on the takeover front help to steady markets in London, although the investment mood remains fragile.

By 8.45am the FTSE 100 index was up three points at 5,073 and the Mid-250 index 24 points firmer at 9,502.

Chloride Group was an early riser at 340.4p, up 52p, following the surprise 325p-a-share bid from Switzerland's ABB. Dealers were hoping for America's Emerson Electric to return with a higher offer.

Aggreko topped the leader board with a jump of 51p to £14.07 in response to an upbeat full-year profits forecast and takeover favourite G4S rose 5p to 271p as it expanded into Brazil.

Mining shares returned to favour after yesterday's sell-off with Xstrata at 932p, Eurasian Natural Resources 972p and BHP Billiton £17.54 between 12p and 20p firmer.

Other leading 'blue chips' to return to prominence included National Grid at 490p, Reed Elsevier 476p, Man Group 235p and Capita Group 775.5p, up 2p to 6p.

Tesco was a major faller at 401.7p, down 5.3p on news that chief executive Sir Terry Leahy is to retire next year. International chief Philip Clarke will succeed him

UK bank tax fears and eurozone debt concerns continued to overshadow banks where RBS softened 0.25p to 42.83p and Barclays declined 2.15p to 283.75p.

Scottish & Southern Energy slipped 10p to £10.65 following a rating downgrade from Bank of America.

Positive broker comment contributed to rises of 7.5p to 25p in Premier Farnell at 225p, Weir Group 920p and Mothercare 537p, but disappointing sales figures unsettled WH Smith at 445p, down 9p.

Among the smaller caps Braemar Group added 0.75p to 2.0125p on the bid from Brooks Macdonald and Ten Alps dipped 3p to 18.35p after positing flat full-year profits.

Rockhopper eased 1.75p to 288.25p after confirming a placing to raise £48.5 million to progress its current drilling programme in the North Falklands basin.