Greece hopes boost FTSE

Hopes for debt-laden Greece helped buoy investor sentiment today and drive blue chip stocks higher.

Hopes for debt-laden Greece helped buoy investor sentiment today and drive blue chip stocks higher.

Ratings agency Standard & Poor's delivered some welcome good news for Greece as it took the country off credit watch for a possible downgrade, while EU finance ministers also said they had a vague blueprint for possible loans to help the Greek economy.

The FTSE 100 Index closed 26.6 points higher at 5620.4 amid the general optimism.

US markets were largely treading water ahead of the latest verdict on the US economy from the Federal Reserve, up less than 20 points within the first few hours.

The Fed is not expected to change interest rates, but dealing rooms will scour the language of its statement for signs of shifting views among policymakers.

Mining stocks largely underpinned gains for London's Footsie as a weaker dollar supported base metal prices.

Sterling approached 1.52 against the greenback, while the euro also edged higher against the dollar amid the optimism over Greece.

Eurasian Natural Resources was the sector's leading riser up 33p to 1166p or 3%. Other miners on the front foot included Randgold Resources, which gained 122p to 5000p.

British Airways shot to the top of the risers board - up 5%, or 10.6p to 246p - after it agreed moves with unions to tackle its £3.7bn (€4.08bn) deficit.

In a quiet session for corporate news, security firm G4S slipped despite posting a 10% rise in underlying profits to £500.3m (€552.3m).

While the company has weathered the recession, it said organic revenues would be flat this year after a rise of 3.7% in 2009 and growth of 9.5% in 2008. Shares have enjoyed a strong run and were down 9.4p to 269.2p today, a fall of 3%.

But Royal Bank of Scotland rose as investors digested speculation that it is planning to restructure up to £10bn (€11bn) of its existing debt in a bid to boost its capital strength. Shares added 0.6p to 43.3p.

Other banks making progress included Barclays, which added 8.9p to 357.5p, and HSBC, which was 2.5p dearer at 683.5p.

BT Group meanwhile climbed for a second successive session, up 1.7p to 126.4p, as it continued to benefit from yesterday's broker upgrade from Citigroup.

Royal Dutch Shell was another riser, up 26.5p to 1856.5p, after chief executive Peter Voser unveiled a strategy update that included plans for more cost savings and an upstream production target of 3.5 million barrels of oil a day by 2012, up 11% on last year.

In the FTSE 250, department store chain Debenhams edged 0.8p lower to 70.2p after a trading update left markets underwhelmed. Sales growth edged 0.3% higher in the first half and profits are set to come in ahead of last year in line with City hopes.

The biggest Footsie risers were British Airways up 10.6p at 246p, Legal & General ahead 2.6p at 82.35p, Eurasian Natural Resources up 33p at 1166p and Barclays up 8.9p at 357.5p.

The biggest Footsie fallers were G4S down 9.4p at 269.2p, Prudential off 7.5p at 530p, Compass Group down 5.1p at 496.9p and Admiral down 11p at 1240p.

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