The FTSE 100 Index finished ahead today as miners made strong gains and Goldman Sachs kicked off the US bank reporting season in impressive style.
Goldman’s record $13.8bn (€10bn) revenues far surpassed expectations and will be followed this week by numbers from JPMorgan Chase, Bank of America and Citigroup.
In London, the Footsie was also supported by commodity stocks amid returning economic optimism as the top flight closed 35.6 points up at 4237.7.
Asian and European markets were also on the front foot, although concerns over higher than expected inflation data from the US held Wall Street gains in check despite decent retail sales figures.
IG Index’s David Jones was cautious at the subdued response to the Goldman figures.
He said: “With the lack of follow-through this afternoon on the back of the Goldman numbers, it could well be that this rally has now run its course and investors are using the strength as an opportunity to sell out at better levels than a few days ago.”
Banks were doing well in London, with Lloyds Banking Group up 1.3p at 65.8p, Barclays ahead 3.6p at 300p and Royal Bank of Scotland 0.7p stronger at 36.9p.
But commodity stocks dominated the risers board after oil prices rose back above $60 a barrel and broker UBS said it expected a better performance from the mining sector in the current quarter. Big risers included Lonmin, which added 92p to 1077p, while Kazakhmys lifted 49.5p to 640.5p and Xstrata rose 31.3p to 614.3p.
UBS was also involved in the market’s biggest fall after it cut heavyweight Vodafone from buy to neutral and lowered its target price from 150p to 115p.
It is the latest downgrade for the stock as analysts fret about Vodafone’s market share in the face of intense competition in key markets.
The mobile phone giant led the fallers board with a drop of 2% or 2.2p to 112.8p.
Meanwhile, British Airways shares were in positive territory after news that pilots had accepted a 2.6% pay cut, although other staff have vowed to campaign against cost-cutting plans.
The airline, which faced protests from unions at its annual meeting in London, was 1.5p stronger at 128.1p as investors also welcomed comments from chairman Martin Broughton that ruled out a rights issue.
In the FTSE 250, Robinsons firm Britvic rose 3% after it said it expected to beat market expectations for the full year.
The firm brought forward third quarter figures today as it said it had seen “particularly strong trading” in the period. Shares rose 9.25p to 306.75p.
Pub companies benefited from Britvic’s strong sales update, with Enterprise Inns up 8p at 133p and JD Wetherspoon 14.5p stronger at 429p, ahead of a trading update tomorrow.
The biggest Footsie risers were Fresnillo ahead 62.5p at 533p, Lonmin up 92p at 1077p, Kazakhmys up 49.5p at 640.5p and Antofagasta up 38p at 625p.
The biggest Footsie fallers were Vodafone down 2.2p to 112.8p, Diageo off 10.5p at 867.5p, Legal & General down 0.5p at 53.7p and Tesco down 3.4p at 359.5p.