FTSE responds positively to G20 agreement

A surge of optimism pushed the FTSE 100 Index up more than 4% today after positive financial news combined with an agreement by world leaders aimed at combating the global economic crisis.

As the G20 Summit announced a deal to make 1 trillion US dollars (€742bn) available to the world economy through the International Monetary Fund and World Bank the Footsie closed up 169.4 points at 4125.

Investors wading back into the London market saw it bounce back through the 4000 barrier today as economic optimism gathered pace - the first time the blue chip share index's moved past the psychologically key barrier in around six weeks.

The buoyant sentiment mirrored a similar across the Atlantic, where the Dow Jones Industrial Average was up more than 3% in early trade.

Wall Street's rally was attributed to a boost for bank stocks after the Financial Accounting Standards Board eased of rules forcing banks to value their assets at current prices. The change should help banks reduce losses.

In London, unexpectedly positive housing news from Nationwide also boosted sentiment. House prices rose for the first time in 16 months during March as buyers continued to return to the market, according to the figures.

This was followed by a Bank of England report suggesting the credit crunch may be easing as the availability of credit to individuals and businesses was predicted to improve during the coming three months.

Commodity stocks and miners were today benefiting from the prospect of increased global demand and a surging oil price.

Kazakhmys led the way on the risers' board, with a 17% hike after an upgrade from Citigroup. Shares rose 68p to 459.5p.

Eurasian Natural Resources followed close behind, up 65.5p at 514 p and Vedanta Resources was 101p up at 793.5p.

Banks were also on the front foot, with Royal Bank of Scotland up more than 12% - or 3.1p - at 28.2p. It was followed by HSBC and Lloyds Banking Group, which gained 48.25p at 459p and 5.5p to 76.5p respectively.

Housebuilders were soaring in the FTSE 250 after Nationwide's news of a 0.9% hike in March property prices and as Taylor Wimpey said it was nearing a deal to restructure its £1.55bn (€1.7bn) debt burden.

Taylor Wimpey rose 23%, or 5.5p to 29p, Barratt Developments increased 18p to 107p and Redrow lifted 23.75p to 176p.

Also in the second tier, babycare retailer Mothercare slid after warning that margins would come under pressure from the falling value of sterling.

Shares lost 4.5p to 391.5p despite the firm reporting a 3.7% hike in quarterly like-for-like sales.

The biggest Footsie risers were Kazakhmys up 68p at 459.5p, Man Group up 36.5p to 254.25p, Standard Chartered up 140p at 1022p and Eurasian Natural Resources 65.5p at 514p.

The biggest Footsie fallers were Randgold Resources down 175p at 3708p, Fresnillo down 13.25p to 452p, Pennon off 8.25p at 404p and Centrica down 3.25p at 227.5p.

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