Banks were in better shape today despite the London market suffering a lack of direction following overnight turmoil across the Atlantic and in Asia.
HBOS, Barclays, Royal Bank of Scotland and Lloyds TSB were all trading up as investors looked ahead to tonight’s crucial House of Representatives vote on the US Government’s massive bank rescue package.
But in signs of continued nerves, the FTSE 100 Index was 3.4 points lower at 4866.9 by mid-morning. The Dow Jones Industrial Average reflected the worries last night, falling 3%, while the Nikkei and Hang Seng were also down by around 2%.
Progress in London this morning was held back by losses for energy stocks as oil prices held steady at 94 US dollars a barrel.
HBOS continued its recovery, rising another 7% or 12.6p to 182.6p. Merger partner Lloyds TSB was 11p higher at 273p. Barclays added 15.75p to 353.75p and Royal Bank of Scotland was up 9.8p to 185.8p.
Marks & Spencer was also enjoying a second strong session after yesterday’s better-than-expected trading update. The improvement of 3p to 230.25p came despite rival John Lewis reporting an 8.3% drop in department store sales for last week.
Blacks Leisure added to the retail gloom by warning that half-year losses were expected to widen to around £4.5 million. It blamed a poor summer for its boardwear business, causing shares to fall nearly 13% or 11.25p to 78.25p.
Sports Direct International, which owns 29% of Blacks, fell 3.75p to 48p, a decline of 7%.
Meanwhile, shares in pubs chain Mitchells & Butlers remained under pressure, falling 26.5p to 197.5p.
Despite oil holding steady at 94 dollars, British Airways was the Footsie’s biggest faller, down 10.3p to 167.8p. The fall came ahead of its September traffic update, which some traders fear could be weak.