A MUCH-NEEDED rally for banking stocks helped power the FTSE 100 index to a gain of more than 2.5 per cent yesterday.
The Footsie closed 135.7 points higher at 5,286.3, boosted by better-than-expected figures from US bank JP Morgan, which helped
the banking sector claw back recent hefty losses.
The gains put the FTSE 100 back up to levels seen before the bloodbath earlier this week amid fears over the US financial sector.
Banks fought back hardest, with Royal Bank of Scotland and Barclays, whose shares have been hammered during the sell-off, vying for top spot on the risers' board.
A lower-than-feared drop in net quarterly income from JP Morgan drove investor sentiment after a strong finish overnight on Wall Street.
Crude oil prices also boosted trading, down below $134 a barrel at one stage and sharply lower than the $147 record last week – although a Nigerian pipeline explosion saw oil prices pick up later in the session.
In London, Barclays rose 23.75p to 290.5p, while RBS cheered with a gain of 14.5p to 2179.5p – both up 9 per cent.
HBOS improved by 5 per cent but the rise of 13.75p to 268.25p appeared to be too late to save the company's £4 billion rights issue, which is priced at 275p.
The share price of second-tier lender Bradford & Bingley was given a slight nudge upwards after shareholders approved a £400 million rights issue based around a 55p price. But the stock still remained below the issue price after improving 3.75p to 54p.
There was also some rare good news from the UK high street yesterday, with positive like-for-like sales growth from Mothercare. Its shares closed unchanged at 346.25p after giving back earlier gains, but the results helped pep up Marks & Spencer, up 16p to 255.75p.
Broadcaster ITV, whose shares have been depressed amid a gloomy outlook for UK advertising, rocketed to the top of the risers' board, ahead 3.8p to 45p.
On the fallers' side, oil explorer Tullow Oil was one of the worst hit, down 5.5p to 793.5p.
Energy stocks were also on the back foot, including British Gas parent Centrica, off 3.5p at 291.75p.
In the FTSE 250, newspaper publisher Trinity Mirror raced 22 per cent ahead, up 13.25p to 73.75p, continuing the rises seen the previous day after it was forced to assure over its liquidity and borrowing.
Housebuilders also made double-digit gains, led by Taylor Wimpey's 25 per cent rise – up 8p to 40.25p – after a raft of upgrades in the sector from broker UBS.
Elsewhere, the Footsie's biggest risers were Standard Chartered, ahead 124p at 1472p, and Old Mutual, up 7.8p at 95.8p.
The biggest fallers were Drax, down 39.5p at 714.5p and Eurasian Natural Resources, off 22p at 1,100p,
The full article contains 508 words and appears in The Scotsman newspaper.
