Steady gains for FTSE

The London market shrugged off disappointing UK growth figures to post steady gains today.

Despite official figures showing growth at its slowest for three years – 0.4% in the first quarter of 2008 – the FTSE 100 Index was 31.9 points higher at 6082.6 by mid morning.

Comments yesterday from US Treasury Secretary Hank Paulson over some signs of easing in financial markets lifted the mood of the Footsie and buoyed bank stocks, with traders in upbeat spirits heading into the weekend.

Shares in transport firms were ahead after upbeat comments from leading operator Go-Ahead, while oil prices falling back also helped the sector.

FTSE 250 operator Go-Ahead’s expectations of better than expected results and an upbeat assessment of rail and bus markets raised its shares nearly 12% or 170p to 1620p.

This caused rivals – including FTSE 100 Index firm FirstGroup – to post sizeable gains. FirstGroup was up 20.5p to 548.5p, while in the second tier Stagecoach added 9p to 212p and National Express rose 27.5p to 893p.

Other firms making progress as oil slipped back to 115 dollars a barrel included British Airways, up 7.5p to 220.25p after also gaining ground on a bullish update from German carrier Lufthansa.

Retailers and banking stocks also featured on the risers board after recovering some of the losses seen in recent days.

B&Q owner Kingfisher added 2.7p to 127.6p and fashion retailer Next cheered 24p to 1097p. Argos owner Home Retail Group, which reports results next week, rose 5p to 243.75p.

Among the banks, improved sentiment following the Treasury chief’s comments helped Alliance & Leicester rise 15.5p to 508.5p and Halifax Bank of Scotland gain 11p to 500p. Barclays added 10.5p to 465.75p.

The other significant move in the FTSE 250 came from Sports Direct International as analysts welcomed yesterday’s news that the company expected to meet full-year earnings targets. Shares were 6p higher at 116.75p, or 5%.