Tullow Oil was the biggest faller in early morning trading as share price fell by 5.5 per cent to 1,226p despite reporting a 152 per cent increase in pre-tax profits for the first half.

The oil firm reported pre-tax profits of approximately £85 million ($131 million) during the first half of 2010, compared with £33.7 million ($52 million) during the prior-year period.

However, regulatory approval for a drilling project in Uganda has been held-up over a tax dispute with former partner Heritage.

Aidan Heavey, chief executive at Tullow Oil, said, 'Tullow has continued to make strong progress in the first half of 2010.

'Our exploration and development programmes are delivering excellent results with significant new oil discoveries being made in both Ghana and Uganda and first oil from Jubilee expected before year-end.'

He added, 'We look forward with confidence to a promising second half of the year and strong performance overall in 2010.'

BG Group's share price was down 1.6 per cent to 1,057p. Biopharmaceutical company Shire saw share price decrease by 1.5 per cent to 1,397p, after mixed news from the US Food and Drug Administration over what competitors to its gastrointestinal drug Pentasa be required to demonstrate that they are equivalent.

The biggest riser was Insurer Admiral Group, which rose 5 per cent to 1,546p after reporting pre-tax profits of £126.9 million.

Henry Engelhardt, group chief executive at Admiral, said, 'The UK car insurance business continues to be the driving force behind our success and in the first half of 2010 we shifted up yet another gear.

'We increased premium rates by around 14 per cent in the first half and increased customer numbers by 23 per cent year-on-year.'

Microchip manufacturer Arm Holdings rose 3.3 per cent to 341p , while Serco Group saw share rpice increase by 3.2 per cent to 577.5p.