FTSE up slightly

The London market held firm today despite sharp falls on Wall Street amid grim US housing and employment news.

The London market held firm today despite sharp falls on Wall Street amid grim US housing and employment news.

Recent gains for the Dow Jones Industrial Average melted away in an early sell-off after official figures showed a shock 5.3% drop in US home sales in January, but the FTSE 100 Index stayed in the black, closing up 32.5 points at 3848.9.

The Dow Jones suffered a 1.4% drop as the positive effect of Federal Reserve chairman Ben Bernanke's forecast that the recession should end this year evaporated. His speech had been credited for lifting the market off its six-year low during Monday's session.

Wall Street was further hit by a government report which showed mass layoffs, or job cuts of 50 or more by a single employer, increased to 2,227 in January, up almost 50% from the same month last year.

However, in the UK, GDP figures defied gloomy forecasts of a worse economic contraction than first estimated in the last quarter of 2008.

Banking stocks were in focus after Mr Bernanke said it was unlikely that stress tests of big US banks would lead to full nationalisations.

Barclays saw gains of 7%, or 7.4p at 105.6p and Lloyds Banking Group was a prominent riser, up 6% or 3.5p to 57.4p, while Royal Bank of Scotland rose 1p to 23.1p as investors prepared for the release of annual results tomorrow.

Meanwhile, Cadbury shares were 4% stronger - up 20p at 528.5p - after it posted underlying profits at the top end of expectations. The firm's "good progress" on margin targets offset disappointment over likely revenues growth at the bottom end of hopes this year.

Property firms also gained ground after JP Morgan analysts upgraded Hammerson, sending the shares 23.25p higher to 334p.

Land Securities added 27.5p at 527.5p and British Land rose 20.25p to 422.25p.

In the FTSE 250 Segro soared 12% or 10.75p to 97.75p after renegotiating bank covenants and lessening the chances of having to ask shareholders for cash.

It was closely followed in the second tier by housebuilder Barratt Developments, which jumped 13% or 9.75p to 81.25p, despite unveiling pre-tax losses of almost £600m (€668.9m) on land writedowns.

Analysts said the scale of the charges was in line with expectations and focused on the group's progress in reducing debt. Fellow builders Bellway and Persimmon added 57p to 616p and 22.75p to 317p respectively.

Also in the FTSE 250, price comparison website Moneysupermarket.com shed 6% after it revealed the recession had caused a 30% drop in current revenues against last year. Shares were down 3p to 45.25p.

The biggest risers were ICAP up 25.5p at 232p, Barclays up 7.4p at 105.6p, Hammerson up 23.25p at 334p and Wolseley up 12.5p at 187p.

The biggest Footsie fallers were Rexam down 7.5p at 259.75p, BHP Billiton down 26p at 1119p, Autonomy Corporation off 25p at 1175p and Vodafone Group down 2.55p at 120.1p.

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