FTSE ends the day higher on EU hope
INVESTORS shrugged off chaos in the Eurozone as Britain’s top share index climbed higher yesterday, with leaders of the most powerful nations meeting in France in an effort to solve Europe’s crippling debt crisis.
London’s blue chip index rose 61.54 points, or 1.1 per cent, to 5,545.64, as the index continued to recoup the sharp losses of more than five per cent sustained earlier in the week.
Investors responded positively as Greek Prime Minister George Papandreou, under pressure from world leaders, climbed down from his proposal of a referendum on the country’s bailout package.
Financials were mixed as concerns remained over Europe.
“Investors seem to be buying on the plans for the referendum being put on hold,” said Atif Latif, director of trading at Guardian Stockbrokers.
“This [uncertainty] does still erode market risk of contagion and we are not convinced by this turnaround and remain cautious around these rallies.”
While equities responded positively to the political posturing at the G20 conference, the bond market was less convinced, with Italian, Spanish and Greek 10 year bond yields all remaining near recent highs.
Mining and integrated oil stocks drove the UK market higher as the US economy showed some signs of improvement.
British sweetener and starches maker Tate & Lyle, which makes most of its profits in the United States, added 5.2 per cent after it shrugged off the economic downturn to post a 38 per cent jump in half-year profit.
ITV gained 5.9 per cent as Credit Suisse repeated its “outperform” on the commercial broadcaster ahead of a third-quarter trading update.
RSA Insurance rose 3.9 per cent as it said it was on track to meet its full-year goals after net premium growth of 11 per cent in the third-quarter.