FTSE 100 close: Gains for Aviva, Unilever, Lloyds
The London market powered ahead today as financial stocks climbed to the top of the charts in a bumper week for bank results.
Lloyds Banking Group was up more than 11% after its better-than-expected losses yesterday, while Royal Bank of Scotland, Barclays and HSBC also saw gains.
The FTSE 100 index climbed almost 1% in a strong day for corporate results - up 43.4 points at 4,690.5.
The market maintained its momentum despite shock news from the Bank of England that it would pump an extra £50bn into the economy through its quantitative easing (QE) scheme.
Though the Bank's announcement had little impact on stock markets, the pound slipped as traders trimmed back expectations about when the central bank would start to raise rates and withdraw monetary stimulus.
Meanwhile a subdued start was predicted on Wall Street with the Dow Jones Industrial Average set to open up just 0.1%.
Aviva, Unilever and ITV posted well-received half-year figures, providing investors with a boost. Banks dominated the risers' board after an interim results season which has so far caused little alarm for investors.
Lloyds Banking Group, which said yesterday that the worst may be over for HBOS bad debts, rose another 11.50p to 104.7p, while Royal Bank of Scotland climbed 4.75p to 53.45p ahead of its own results on Friday. Barclays and HSBC impressed with combined profits of £6bn on Monday and were ahead 17.5p to 354p and 33.8p to 661p respectively today.
Aviva was one of the session's biggest risers, up 5.44% or 19.4p to 375.7p, as better-than-expected operating profits and a solvency surplus of £3.2bn offset any disappointment over a 31% dividend cut.
Unilever shares enjoyed a gain of 5.44% - up 84p to 1629p - after traders were encouraged by a return to sales volume growth during the second quarter.
Invensys was one of the biggest fallers on the FTSE 100, after Goldman Sachs downgraded the stock to 'neutral' and removes it from the broker's 'pan-European buy list'.
Goldman Sachs says the stock no longer has one of the most attractive upsides in the sector. The broker has a price target of 264p for the stock, with a 12-month price target of 325p.
Outside the top flight, broadcaster ITV rallied 7% in early trading after it said the decline in advertising revenues should slow over the rest of this year and announced the sale of Friends Reunited for £25m. ITV later closed just 1.33% up at 42.56p.
Bellway shares rose 6p to 785p after it echoed recent positive comments on the housing market and announced a £45m fundraising to support land-buying opportunities in the south.
Ladbrokes rose 3.6p to 171.1p despite reporting a fall in profits and cuts to its dividend payout. The company said cancellations and poor margins in horse racing and a first ever loss-making month on football added to pressure caused by recession.
And shares in recruitment company Matchtech fell 5.1% after the company announced a 9% fall in net fee income and says it remains cautious on 2010 outlook. The company regained ground throughout the day to close 2p up at 129.5p
KBC Peel Hunt says: 'The weakness came from permanent placements in H2, with Built Environment the worst performing segment.'
The broker, which has a target price of 170p, equal to 5 times 2010 EPS, says its valuation of Matchtech is in line with the tech engineer recruitment peer group.
Millennium & Copthorne soared 24.6% after the hotelier said it is seeing encouraging signs of stability returning to its major markets, prompting Credit Suisse to upgrade to 'neutral' from 'underperform' and raise its target share price to 310p from 183p.
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