SM:FTSE makes strong start as banks and oil stocks rise
StockMarketWire.com - MORNING REPORT: Headline shares made a firm start, with banks recovering ground after yesterday's knee-jerk falls following the ICB reform report, while oil producers and miners benefited from rising crude and metals prices.
In early trade, the FTSE100 was up 30.31 points at 5,159.93 with the FTSE250 ahead 71.75 points at 10,055.5 and the FTSE Smallcaps 8.22 points better at 2,881.47.
US & ASIA
In the US last night, the Dow rose 69 points at 11,061, the Nasdaq Composite added 27 points at 2,495 and the S&P500 gained 8 points at 1,162.
In Asia today, the Nikkei closed up 81 points at 8,617, while the Hong Kong markets are closed for the Mid-Autumn Festival holiday.
LONDON MARKETS
Markets took heart from news of Chinese investment in European debt, taking the immediate pressure off Italy. However, concerns over a default by Greece remain. Banks settled after the initial knee-jerk reaction to the ICB report, while resources stocks showed fresh impetus as crude oil and base metals prices recovered.
However, investors in London remained cautious ahead of the latest UK inflation readings, due for release later this morning.
Royal Bank of Scotland led the banks higher, rising 0.64p at 21.41p, while Barclays improved 2.08p at 143.73p and Lloyds added 0.46p at 31.02p.
Insurers followed the trend, with Prudential ahead 6.25p at 574.25p and Legal & General gaining 1.23p at 92.13p, while Aviva rose a more modest 2.9p at 292.1p, progress hit by a cut in target price to 290p from 398p at UBS.
Oil producers were buoyed by WTI crude bubbling over $89 a barrel, with Shell up 20.5p at 2,037p and BP ahead 5.2p at 380.7p. Tullow Oil rose 9.5p at 1,406.5p, benefiting from a rise in target price to 1,450p from 1,100p at HSBC.
Conversely, Cairn Energy slumped to the foot of the table, down 19.5p at 293p, following disappointing results from its offshore drilling campaign in Greenland.
Miners put in a largely positive performance, with ENRC the best of the bunch, up 5p at 627.5p. Anglo American gained 10.25p at 2,368.75p and Xstrata added 6.5p at 987.2p. Fresnillo continued to slide on weaker silver prices, down 25.5p at 1,963.5p.
Amongst the retailers, Marks & Spencer continued to enjoy the positive feedback from yesterday's presentation of its new strategy, gaining a further 3.9p at 318.9p. Elsewhere, Tesco rose 2.18p and Sainsbury added 2.05p at 277.65p, while Morrisons edged ahead a more modest 0.15p at 394.15p.
Fashion chain Next put in one of the better performances in the sector, rising 16p at 2,355p.
Other notable gainers included accountancy software specialist Sage Group, up 5p at 253.4p, satellite operator Inmarsat, ahead 8.85p at 485.45p, and industrial pump manufacturer Weir Group, 29p better at 1,783p.
On the limited downside with blue chips, utility groups came under pressure, with National Grid down 8.75p at 607.25p, International Power off 1.4p at 317.3p and Scottish & Southern Energy, 2.5p lower at 1,251.5p.
Chip designer ARM Holdings slipped 9.5p at 580.5p and household goods conglomerate Unilever lost 8.5p at 1,932.5p.
