The index rose 52 points, or 0.8%, to 6,752, having earlier reached 6,762, its highest level since early March. BP and St James's Place added to gains made in the morning's trading as investors continued to digest their solid results. BP rose 14.3p, or 2.9%, to 502.6p, while St James's Place added 15.5p, or 2% to reach 867.5p.
But Shire (SHP.L), the star performer of the morning (see below) gave away its gains, as the prospects of a takeover from US Botox manufacturer Allergan appeared to wane. Shares in the pharmaceutical group had surged after Reuters reported a bid was on the cards, but those gains were erased after reports Allergan was exploring a sale of its business to Sanofi or Johnson & Johnson, ruling out a bid for Shire.
Shire fell 23p, or 0.7%, on the news.
FTSE gets fresh drugs boost as UK growth disappoints
10:56 The red-hot pharmaceuticals sector continued to drive the FTSE 100 as a surge in the share price of Shire (SHP.L) helped to lift the UK blue-chip index.
Shire jumped 129p, or 3.9%, to £34.14 after a Reuters report said US Botox-maker Allergan was preparing a fresh takeover approach for the Dublin-based pharmaceuticals group. Allergan approached Shire about a potential takeover in recent months, but could not agree a deal.
Mike van Dulken, head of research at Accendo Markets, said the news showed 'the appetite for consolidation in the sector, notably for companies located in countries with lower tax where the newly combined entity can be headquartered'.
The FTSE 100 rose 33 points, or 0.5%, to 6,733, with gains tempered only slightly by the release of figures showing gross domestic product (GDP) growth of 0.8% in the first quarter of the year, below investors' expectations. The pound fell on the news to $1.6812 from around $1.6839 earlier.
Although slightly below forecasts, the GDP figure show the UK is experiencing its fastest annual rate of growth since 2007. Markit chief economist Chris Williamson said the expansion was 'all the more remarkable for having occurred despite extreme weather, including flooding, which affected many parts of the country'.
He added that the sectors which had disappointed 'were all in sectors where weather may have hit activity and are therefore likely to rebound in the second quarter'.
'With further robust growth likely in the second quarter of 2014, the economy is therefore set to surpass its pre-crisis peak in the summer,' Williamson added.
BG Group (BG.L) pared losses suffered yesterday after the oil and gas group announced the shock departure of boss Chris Finlayson due to personal reasons, and issued disappointing new guidance over 2014 production figures. The shares rose 19p, or 1.7%, to £11.65 on speculation it may attract bid interest.
St James's Place (SJP.L) added 8p, or 1%, to reach 771.5p, after the financial salesforce reported a strong start to the year.
Whitbread (WTB.L) edged up 36p, or 0.9%, to £40.97 as the Premier Inn and Costa Coffee owner revealed a 16.5% rise in full-year profits.
And BP (BP.L) rose 4.3p, or 0.8%, to 492.5p after the oil group posted first quarter profits slightly ahead of expectations and raised its dividend for the second time in six months.
Jeremy Thomas, co-manager of the Brunner investment trust (BUT), said BP's results were encouraging. 'BP has slightly lagged the improving share prices of its peers since the Ukrainian crisis broke and the step up in the international communities' sanctions on Russia add to the uncertainty around the value of BP's 19.75% stake in Roseneft. However, for long-term investors it is the growth in the book value per share of BP that will matter and the 2014 first quarter results and tone of the statement are pleasing markers on that journey.'
Miners lost ground with Fresnillo (FRES.L), Randgold Resources (RRS.L), Antofagasta (ANTO.L), Anglo American (AAL.L), BHP Billiton (BLT.L) and Glencore (GLEN.L) all among the big fallers. Fresnillo dropped the most, falling 12.5p, or 1.4%, to 852.5p.
AstraZeneca (AZN.L) also fell back after yesterday's huge surge prompted by US rival Pfizer's confirmation it made a second takeover approach last week. The pharmaceutical group shed 27p, or 0.6%, to £46.38.