Oil and banking stocks buoy FTSE

Progress by oil and banking stocks left the FTSE 100 Index on track to end the week on a three-month high today.

Progress by oil and banking stocks left the FTSE 100 Index on track to end the week on a three-month high today.

With the price of a barrel of crude oil edging remaining above $54, heavyweights BP and Shell both added around 1.5% to their market value.

By mid-morning, the Footsie lifted 27.8 points to 5037, representing considerable progress since early May when it was languishing around the 4800 mark.

Yesterday’s comments about US interest rates by Federal Reserve chairman Alan Greenspan were underpinning progress in London.

Mr Greenspan reassured traders by saying the US economy was on a “firm footing” and that base rates may keep rising at a measured pace, lifting the Dow Jones Industrial Average 26 points.

Back in London, BP was the highest oil industry riser with a 9.5p gain to 573p. Shell was close behind with a 7.5p improvement to 491.5p and BG Group added 6.75p to 441p.

Banks also featured on the Footsie risers board as the recent steady course for interest rates settled the stocks.

HBOS lifted 14.5p to 834.5p, Barclays cheered 8p to 528p and Lloyds TSB was 5.5p higher at 463p.

On a slow day for corporate news, Woolworths made modest progress after announcing a number of new appointments to its board. Shares in the FTSE 250 stock increased by half a penny to 36p.

Channel Tunnel operator Eurotunnel advanced 0.25p to 17.25p despite announcing its chief executive had quit in the wake of a boardroom row. Jean-Louis Raymond, who took the helm after a shareholder revolt last year, is said to have clashed with chairman Jacques Gounon.

London brewer Fuller’s was in the red, however, losing nearly 6% or 52.5p to 890p despite posting a 6% rise in underlying profits.

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