Good day for FTSE

Banks helped lift London's leading index sharply higher today after Lloyds Banking Group boss Antonio Horta-Osorio received backing for his plans to overhaul the taxpayer-controlled bank.

Good day for FTSE

Banks helped lift London's leading index sharply higher today after Lloyds Banking Group boss Antonio Horta-Osorio received backing for his plans to overhaul the taxpayer-controlled bank.

The FTSE 100 Index gained 89.8 to 5945.7, with Lloyds almost 10% or 4.3p higher at 49p after Mr Horta-Osorio, who took up the top post in March, said he hoped the markets would find his strategic review "clear and simple". Lloyds will cut a further 15,000 roles under the plan.

Sentiment was also boosted by a very strong start on Wall Street after better than expected manufacturing data for the Chicago area and lower weekly jobless claims.

A second approval in the Greek parliament for the new austerity package lifted the euro to 1.10 against the pound, while sterling also drifted to 1.60 against the dollar.

But it was the banks, and Lloyds in particular, that held the market's attention. Bruce Packard, financials analyst at Seymour Pierce Research, said the overhaul "looks sensible", while another broker, Espirito Santo, added that the revamp could clear the way for the bank to restart dividend payments in 2013.

Other banks rose alongside Lloyds, with Royal Bank of Scotland adding 1.7p to 38.5p and Barclays ahead 7.2p to 256.5p.

HSBC was another riser on plans to trim its UK cost base through 700 job losses at its wealth management division. The shares added 6p to 618.4p.

Better-than-expected US oil inventory data boosted crude oil prices and triggered a 2% boost to BP shares, which were up 9.3p at 458.7p.

Gas giant BG Group was almost 5% higher after it doubled its reserves and resources estimates linked to its Santos Basin operations in the south Atlantic.

BSkyB shares were broadly flat after the Government provisionally accepted plans by takeover suitor News Corporation to hive off Sky News as a separate company.

News Corp, which also owns the Sun and the Times newspapers in the UK, wants to buy the 61% of shares in the company it does not already own. Shares were 1.5p lower at 846.5p.

Outside the top flight, entertainment group HMV shares dipped as it revealed underlying profits slumped 61% to £28.9m (€31.96m) - which was in line with expectations. Shares were 0.3p lower at 9.7p.

London Stock Exchange was another riser, adding 105p, or 11%, to 1061p as traders speculated the collapse of the proposed merger with its Canadian counterpart TMX yesterday could make it a takeover target.

Mr Kipling and Hovis maker Premier Foods slumped 22% or 5.5p to 19p as it warned on profits after it struggled to pass on soaring commodity costs to its supermarket customers amid the squeeze in consumer spending.

The Footsie's biggest risers were Lloyds Banking up 4.3p at 49p, BG ahead 64p at 1414p, Royal Bank of Scotland up 1.7p at 38.5p and Vedanta Resources ahead 62p at 2094p.

The Footsie's biggest fallers were Petrofac down 31p at 1514p, ICAP off 5.8p at 473p, ARM down 6.5p at 588p and Fresnillo off 13p at 1402p.

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