Positive session for banks on FTSE

Halifax Bank of Scotland led another positive session for banks on the FTSE today as investors welcomed Senate support for a new US financial rescue plan.

HBOS jumped 20% – up 29.7p to 177.8p – as renewed confidence in its takeover by Lloyds TSB maintained its recovery from lows seen earlier in the week.

Marks & Spencer was another big riser after unveiling better-than-expected trading figures and a cost clampdown, ensuring the FTSE 100 Index reached mid-morning 75.5 points higher at 5035.1.

The US government rescue package still has to go to the House of Representatives, but the Senate’s vote looks to have given the plan a new lease of life. Lloyds TSB firmed 16p to 266p, and Barclays was 16.25p better off at 357.25p.

M&S, which unveiled a 6.1% drop in like-for-like sales during the 13 weeks to September 27, rose nearly 10%, or 20.25p to 230.5p. The group said it was cutting back at least £100m (€127m) on costs in response to the tough trading, which was well received by analysts. Fellow clothing retailer Next was also in better shape, up 86p to 1145p, while B&Q owner Kingfisher added 7.33p to 142.3p.

Bicycle and car parts retailer Halfords joined the retail rally in the FTSE 250 Index after displaying its defensive qualities with a solid sales performance for the 13 weeks to September 26. Shares jumped 22.5p to 278.5p.

Currys owner DSG International shared in the positive sentiment with a rise of 4.25p to 51.25p, while pubs chain JD Wetherspoon added 19.75p to 263.75p.

In a session littered with strong gains, directories firm Yell topped the FTSE 250 risers board after an improvement of 13% or 10.25p to 90.75p. Analysts said the rise reflected hopes that a debt refinancing was on the cards.