Shares up as top firms post figures

Shares in some of the UK’s biggest companies gained ground as firms gave their verdict on trading

Shares in some of the UK's biggest companies gained ground as firms gave their verdict on trading through the most difficult months of the recession.

The FTSE 100 rose more than 1% on the figures, which mostly bettered the worst fears of City analysts, but most companies were extremely cautious about the outlook.

Industry heavyweights such as Royal Dutch Shell, BT and Rolls-Royce were among 10 Footsie members posting results.

Among these, eight were reporting figures for the first six months of 2009 - including a first quarter when UK output slumped to a 50-year low.

Aerospace giant Rolls-Royce beat City expectations and lifted orders to a record £57.5 billion, although it also warned that "the recovery is likely to be slow".

Shell posted a 70% slide in profits to 2.3 billion US dollars (£1.4 billion) and - like rival BP on Tuesday - warned of weak energy demand.

Chief executive Peter Voser said: "Conditions are likely to remain challenging for some time, and we are not banking on a quick recovery."

Both companies have shed thousands of jobs to strip out costs and protect themselves against recession.

Richard Hunter, head of equities at stockbroker Hargreaves Lansdown, said: "Generally, the results have surprised on the upside although, having said that, a lot forecasts have been downgraded earlier in the year.

"But the concern at the moment is that not all but a good selection of these companies have got these numbers as much through cutting costs as growing their revenue line. When you cut costs, lay off staff and cut the dividend, that is not sustainable in the long term."