The London market enjoyed a reversal of fortunes today as it leapt into the black after better-than-expected US consumer confidence figures.
Investors had suffered rattled nerves as a result of signs of aggression from North Korea, but these were soothed by the US data which gave America’s Dow Jones Industrial Average a 2% boost in early trading.
The FTSE 100 Index closed up 46.4 points at 4411.7 after a day spent in the red following a North Korean nuclear test and the reported firing of two short-range missiles.
But news from the US indicated consumer sentiment rose in May to the highest level since September, far above analyst expectations.
Investors cheered at the report, which is thought to give a clue as to whether consumers may start shopping. Spending by consumers makes up more than two-thirds of US economic activity.
With little to focus on as the week swung into action after the bank holiday weekend, investors searched for more defensive stocks.
Oil majors saw rises despite volatility in the price of crude as investors waited for the latest meeting of the Opec oil-producing cartel later this week.
Royal Dutch Shell rose 28p to 1663p as speculation mounted over incoming boss Peter Voser’s plans for the firm. Reports suggest he will merge the gas and power unit with the exploration and production arm and axe 30% of senior management staff.
Tullow Oil gained 12p at 990p and BP rose 4.5p to 505.25p.
Other defensive stocks making gains today included British American Tobacco, which was among the top flight’s biggest risers, up 64p to 1725p, while Benson & Hedges firm Imperial Tobacco added 43p to 1651p.
Food retailers also advanced, with Tesco up 12.4p to 363.3p, following its announcement that its staff bonus pot was 8% up on the previous year after Tesco’s annual profits broke through the £3bn (€3.41bn) barrier.
Sainsbury’s added 5.5p to 318.5p and Morrisons was also 5.5p better at 245.5p.
Drinks can maker Rexam joined the top risers, up 10.25p to 312.75p after Goldman Sachs analysts upped the stock to a “buy”.
But financial and travel stocks slumped into the red.
Lloyds Banking Group was a leading casualty after reports said it was looking to sell stakes in up to 60 companies acquired when it bought Halifax Bank of Scotland.
Shares fell 1.8p to 66.8p, a drop of almost 3%, while RBS fell 0.7p to 40.2p, but Barclays moved into the black, rising 2.5p at 289.25p.
Thomas Cook and Thomson owner TUI Travel were also lower in the top flight, down 10p at 224.75p and 4p at 253.75p respectively. The falls followed a Credit Suisse decision to cut its Thomas Cook target price amid concerns over later bookings and rising debt levels.
The biggest Footsie risers were Eurasian Natural Resources up 39p at 613p, British American Tobacco up 64p at 1725p, Tesco up 12.4p to 363.3p and Rexam up 10.25p to 312.75.
The biggest fallers were Thomas Cook down 10p at 224.75p, Lloyds Banking Group down 1.8p at 66.8p, Friends Provident off 1.8p at 69.9p and Cairn Energy down 55p at 2341p.