FTSE bounces back

Hopes that the US Government’s $700bn bank bail-out may not be dead in the water helped the London market bounce back nearly 2% today.

A vow from President Bush to get the package through Congress despite last night’s shock rejection saw investors keep their fingers crossed that a new version of the deal can be hammered out before the end of the week.

The FTSE 100 Index closed up 83.7 points up 4902.4 by the close, a rise of 1.7%. It was a wildly different picture from the hefty falls predicted today, and clawed back some of yesterday’s 5% slump.

Afternoon trading was boosted by a good start on Wall Street, with the Dow Jones Industrial Average rising nearly 3% following yesterday’s record 7% plunge.

It was a mixed session for London’s banks with Halifax Bank of Scotland off 14% or 19.6p to 122.4p amid speculation that its takeover by Lloyds TSB may need to be repriced. Lloyds TSB shares were 9.25p higher at 226.5p.

Royal Bank of Scotland was 1% lower, down 2p at 179p, despite telling investors that the acquisition of ABN Amro assets would not be affected by the forced sale of a stake by bid partner Fortis. Barclays also lost 2%, or 7.75p to 326.5p.

HSBC, which is seen as a steadier bet in the current turmoil, rose 36p to 901p.

The major corporate news of the session came from Tesco, which rose nearly 5% or 17.7p to 387.6p after it reported a 10% rise in half-year profits and said it was making inroads in the battle against discount rivals.

Other retailers also enjoyed a good session, with Morrisons up 11.25p to 258.5p. B&Q owner Kingfisher also added 3.4p to 131.7p.

But Marks & Spencer moved in the opposite direction, ending the day down 6.75p to 201.5p. The group issues a trading update on Thursday.

Shares in broadcaster ITV also edged up 1p to 42p after the firm announced more than 400 job cuts as part of a cost-cutting exercise.

Pubs chain Enterprise Inns rose 21.25p to 178.5p – up 14% – after it described trading as robust and said it remained on track to meet profit expectations. This was welcomed by other pub chains, causing Punch Taverns to recoup yesterday’s losses with a gain of 14.5p to 135p and Mitchells & Butlers to lift by 14.25p to 220.25p.

On the downside, oil firms were among the losers as oil remained pegged below 100 US dollars a barrel. BP was off 3p to 464p, and Cairn Energy 1p lower at 2072p. Fuel-hungry British Airways also lost 1.2p to 168.2p despite oil’s fall.

The Footsie’s four biggest risers were ICAP, up 65.75p to 355p, Thomas Cook up 18.75p to 221.75p, London Stock Exchange up 72p to 863p and Old Mutual which closed up 6.3p to 77p.

The four biggest fallers were HBOS, down 19.6p to 122.4p, Marks & Spencer down 6.75p to 201.75p, Barclays down 7.75p to 326.5p and Stagecoach Group, which closed down 4.5p to 251.25p.

More in this Section

Construction industry wants all building sites to shut immediately Construction industry wants all building sites to shut immediately

Mobile companies to be given extra bandwidth to handle Covid-19 surge in callsMobile companies to be given extra bandwidth to handle Covid-19 surge in calls

Mortgage interest relief measures slammedMortgage interest relief measures slammed

Consumer spending 'may fall 10%' this yearConsumer spending 'may fall 10%' this year


As the clocks go ahead, so does your style. Corina Gaffney picks your new wardrobe heroesFashion forward: Spring fashion as the clocks change

Des O'Sullivan gives an overview of the changed dates for much-anticipated salesAntiques & FIne Art: What events are put on hold for now?

Virtual auctions a welcome distraction, writes Des O’SullivanBuyers adapt with ease to bid online while grounded

I wish I could write us all back in time, when we could pop to the shops without fear, when grandparents did not have to wave through a window at their grandchildren.Michelle Darmody: Recipes with simple ingredients

More From The Irish Examiner