FTSE jumps as Dubai fears ease

London’s FTSE 100 Index jumped 1.5% today as worries over the global impact of the Dubai debt crisis showed signs of easing.

London’s FTSE 100 Index jumped 1.5% today as worries over the global impact of the Dubai debt crisis showed signs of easing.

With investors regaining their appetite for riskier stocks, the Footsie climbed 80 points to 5270.6 by mid-morning.

London and other world markets recovered their poise after government-owned Dubai World announced plans to restructure almost half its estimated $60bn (€40bn) of debt, amid “constructive” discussions with banks.

While Asian and European investors were on the recovery trail, markets in the Gulf suffered a second successive session of turbulence.

In London, miners led the revival with Xstrata up 32p at 1101p, Eurasian Natural Resources ahead 47p at 908.5p and Rio Tinto 75.5p stronger at 3163.5p.

Royal Bank of Scotland, which is seen as one of the UK banks most exposed to the Dubai debt crisis, lifted 1p to 34.1p.

Property companies were also in favour after Morgan Stanley said the market under-valued leading firm Hammerson’s UK development prospects. Hammerson rose 15.1p to 415.8p, while Liberty International added 17.1p to 482.6p and Segro added 11.3p to 336.8p.

Outside the top flight, housebuilders were on the front foot after the Nationwide said house prices rose for the seventh month in a row during November.

Charles Church owner Persimmon lifted 29.1p to 442.7p, while Barratt Developments added 5.6p to 123.8p and Bovis Homes cheered 14.9p to 404.7p.

Brewer and pubs chain Greene King set the pace in the FTSE 250 Index after posting a 3% rise in half-year profits. It also told investors that it was confident of further progress in the second half, causing shares to rise 6% or 24.6p to 425.9p.

Pubs chain Mitchells & Butlers was another riser, up 5% or 12.2p to 264.7p, after it appeared to draw a line under its recent boardroom difficulties by announcing the appointment of senior director Simon Laffin as chairman.

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