London last week

Old Mutual Asset Management UK man on the spot Quentin Smith reports that over the week the All-Share Index rose 4.1% helped by a 4.5% gain in the FTSE 100, with midcaps 2.8% and smaller companies the laggards, rising just 0.6%.

All sectors ended the week ahead, led by basic materials and telecoms, while the weakest performers included health care and selected industrials.

BP (+5.1% to 651p), Europe's largest oil company, reported a 30% rise to a record level in second quarter profit as crude prices surged and refining earnings increased. BP is trying to raise crude and natural gas output after oil reached a record $78 a barrel.

The exploration and production unit increased profit by 32%, while refining and marketing profit rose 46%.

Retailer Woolworths Group (+4.9% to 32p) reported worsening sales declines towards the end of the first half as shoppers stayed at home to watch the World Cup soccer tournament.

Same store sales fell 7.7% in the first half, worse than had been expected. The company commented that the environment remains challenging, with sales also being hurt as higher taxes and energy bills cut into household incomes, while food retailers expand into non-food merchandise such as toys, DVDs and clothing, which Woolworths also sells.

GlaxoSmithKline (+0.1% to 1493p) reported a 14% rise in second quarter profit, led by children's vaccines and the diabetes treatment Avandia.

Glaxo expects earnings per share to rise by about 12% this year, below market forecasts, and is counting on its new Requip drug for restless leg syndrome, renewed demand for the Advair asthma medicine and the re-introduction of a diabetes treatment from the Avandia family of drugs to spur growth in the second half.

Cigarette maker British American Tobacco (+3.1% to 1433p) reported a 9.1% rise in second quarter earnings as it closed factories and increased sales to regions such as Latin America.

Tobacco consumption in western Europe has been falling 1-2% a year because of higher taxes, advertising restrictions and smoking bans, leading cigarette makers to turn to new markets such as Russia, where demand is rising.

BT Group (+1.6% to 239p), Britains largest phone company, reported rising fiscal first quarter profit on lower finance costs and higher sales.

Without its own cellular phone network, which it spun off in 2001 to cut debt, BT is relying on demand for broadband services and on contracts to manage other companies networks to make up for declining revenue from traditional voice calls.

At the same time, profit margins on broadband internet services are being squeezed by increased competition.