M&S share price tops £5

Hopes of a positive Christmas trading period helped shares in Marks & Spencer build on recent momentum to pass a new milestone today.

Shares were trading above the £5 mark for the first time since 1998 – a level unthinkable a year ago when the stock languished at 341p in the early days of chief executive Stuart Rose’s turnaround strategy.

Sentiment towards M&S and other high street stocks was helped by trading figures from department store chain John Lewis, which said sales improved by almost 12% in the month before Christmas.

Rival operators including Next and Matalan also saw their shares lift on a day when the FTSE 100 Index rose above the 5600 mark – its highest level in around four years – amid light trading volumes.

M&S shares have surged 47% in the last three months, boosted by news of a surprise pick-up in sales in October and positive notes from a number of City brokers. Morgan Stanley recently gave the stock a target price of 510p.

The retailer will give an update on the third quarter in January, with Morgan Stanley recently forecasting a 3.4% increase in like-for-like sales compared with the same period last year.

The company now has a market value of £8.3bn (€12bn). Shares were 8p higher at 506.5p today, an increase of more than 1%.