FTSE 100 close: Footsie forges further ahead

By Adrian Lowery
Updated: 12:13 EDT, 6 May 2009

The London market made further progress today despite some downbeat economic and property news. Financial stocks remained on the front foot, and the FTSE 100 index closed 59.6 points higher at 4,396.5.

Market watcher: How will share react to news today?

A positive open on Wall St this afternoon helped shares to shrug off a downbeat economic assessment from the NIESR and some poor Halifax house price figures.

US blue chips opened higher after private sector payroll data showed job losses slowed in April, a fresh sign the US economy's worst days may be past. The Dow Jones was 45.8 points up at 8,456.5 after the London close.

US banks will tomorrow reveal the results of the government's stress tests: it has been reported that regulators have warned Bank of America it will need to raise around $35bn (£23.3bn).

The jitters seemed to spread to the UK banks after a solid start today. Barclays was down more than 3% after cautious assessments from analysts. Shares saw a 10p drop to 288p.

Lloyds Banking Group was hit worse, losing 7.9p at 113.2p. But HSBC climbed the leaders' board with a 4% rise, up 21.5p at 539p after an analyst upgrade. Meanwhile, Standard Chartered led the risers, up 106p at 1256p.

Aviva rose 11p to 338.5p, after the Norwich Union owner improved after it announced a new reattribution offer to one million policyholders in two of its with-profits funds. Rival Legal & General added 5.4p to 65.4p.

Accountancy software company Sage rallied after it detailed better than expected revenues and a 14% rise in pre-tax profits. Shares were 10.7p higher at 196p.

As well as a number of commodity stocks, the Footsie fallers board featured the retailer Next - despite better than expected sales figures. Shares fell 46p to 1640p as investors preferred to focus on the company's cautious comments about trading in the next few months.

In a busy session for corporate updates, shares in pubs chain JD Wetherspoon gained 1.25p to 447.25p - after it said it was slightly more optimistic about prospects in the current financial year. EasyJet shares were 13p lower at 319.25p after the company said it remained on track to make a profit this year, despite a wider half-year loss.

Building supplies company Wolseley was one of the biggest Footsie gainers after revealing a deal with a US private equity to extricate itself from American venture Stock Building Supply. Wolseley will retain a 49% interest.

The transaction is expected to improve Wolseley's position with respect to banking covenants by about £375m, it said. Shares are up 8.5% or 115p to 1,464p.

Shares in British American Tobacco were 57p up at 1,640p after it said it expects another year of good earnings growth.

Revenues grew strongly in constant currency terms, due to good pricing, with all regions contributing, and the group result also benefited from favourable currency movements.

BATS' four Global Drive Brands achieved overall volume growth of 7%, with Dunhill up 8%, Kent up 3%, Lucky Strike up 4% and Pall Mall up by 11%, while volume growth came from last year's acquisitions of Skandinavisk Tobakskompagni and Tekel.

CEO Paul Adams said the group have been 'encouraged by the good start to the year', and added 'the first quarter's trading demonstrates the strength of British American Tobacco's business, despite the difficult economic conditions'.

Richard Curr, Head of Dealing at Blue Index says traders and dealers alike are picking up BATS shares.

'We see BATS as a strong play for all seasons, on the one hand seemingly immune to the Credit Crunch, and on the other a strong play for global market recovery. We are buyers of British Tobacco, with a 30-day target price of 1,700p.'

On the small caps front, shares in Condor Resources rocketed 33% to or 0.26p to 1.03p this morning after the central American gold and silver miner announced it had won a new concession adjacent to Condor's wholly-owned Cacao Concession in Nicaragua.

The new concession shows surface evidence of gold mineralisation extending over a distance of at least 4km.

Alastair Ford and Charles Wyatt at Minesite.com say that the news turns Condor into 'an intriguing investment proposition, particularly as they are currently the subject of a potential hostile bid from Classdrive'.