FTSE close: Bounce back; Aviva and Pru up

 

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Chinese investors watch stock index in a stock exchange

Eastern promise: Shares took heart from news that the nuclear situation may be coming under control.

The London stock market staged a mini-recovery today after six successive days of falls, closing up 98 points.

The FTSE 100 jumped 97.9 points to 5696.1, up 1.7%, while Wall Street's Dow Jones Industrial Average was up 143 points to 11,756 by 5pm.

Positive US economic news and firmer metal prices provided some much-needed respite from the Japanese crisis, with investors snapping up cheap-looking stocks.

Indices across Europe staged a similar fight-back, with the Cac 40 in France up 2.4% and Germany's Dax 2.2% ahead.

Figures revealing a bigger-than-unexpected drop in US unemployment claims spurred on gains and helped the recovery.

Investors have been swamped with unsettling news in recent days with unrest in Bahrain and Europe's sovereign debt worries coming on top of the Japanese earthquake and crisis at the Fukushima nuclear plant.

The Nikkei, which fell heavily on Monday and Tuesday before a rebound yesterday, slipped 1.4% in Tokyo, but the decline was not as bad as earlier in the session.

Even though the situation at the nuclear plant remained uncertain, investors took the opportunity to buy into recent losses for some of London's biggest stocks.

Hopes of intervention to stabilise financial markets from G7 finance ministers, who have convened an emergency meeting, also boosted trader confidence.

The pound rose against the euro and the US dollar, helped by a Bank of England survey showing inflation expectations at their highest for two years, which some took as further pressure to raise interest rates.

Stocks benefiting from the rebound included firms in the insurance sector as Aviva rose 15.8p to 437p and Prudential lifted 16.5p to 690p.

However, Legal & General eased back as the insurer failed to benefit from its announcement of a 24% rise in its full-year dividend. Analysts praised its full-year results, which showed a 2% rise in group pre-tax profits, but shares were down by 0.4p to 110.7p.

Roofing and insulation specialist SIG jumped 8% or 9.4p to 130.5p, in the FTSE 250 Index after it posted a 3% improvement in underlying profits and said it planned to resume dividend payments later this year.

In a strong session for stocks in the FTSE 250 Index, Heritage Oil rose 8% or 23.8p to 313.5p after the Financial Times said the oil and gas explorer had received an informal takeover approach from a Middle Eastern company.

Heritage, which is focused on Africa, the Middle East and Russia, is understood to have rejected the offer worth 425p a share.

It was joined on the risers board by bakery chain Greggs, which enjoyed another strong session in the wake of its full-year results on Wednesday.

Greggs posted an 8% rise in profits and sounded hopeful about its ability to offset rising costs this year, prompting shares to lift another 33.3p to 499.6p.

The biggest Footsie risers were Arm Holdings up 29.5p to 533.5p, Eurasian Natural Resources ahead 39p to 899p, Antofagasta up 55p to 1347p and Weir up 65p to 1606p.

The biggest Footsie fallers were Man Group down 5.3p to 244.2p, Schroders off 7p to 1684p, Legal & General down 0.4p to 110.7p and SAB Miller down 3p to 1981.5p.

15.30: US investors have been soothed by Japan's efforts to address its nuclear crisis.

But the latest economic data from across the Atlantic was mixed, with industrial production slipping 0.1% last month against a forecast rise of 0.7%.

New US jobless claims fell more than predicted in the past week, while a 0.5% rise in consumer prices in February was in line with expectations.

The Dow is up 141.4 points at 11,754.7.

We have a story on upmarket estate agent Savills, which anticipates fewer transactions in Asia in 2011 following the Japan disaster and curbs on property speculation elsewhere in the region.

It reported increased profits for 2010 as wealthy overseas investors targeted London. The firm's shares are down 5.9p at 368.1p

Heritage Oil rose 8% or 24.3p to 314p after a report that the oil and gas explorer had received an informal takeover approach from a Middle Eastern company.

Heritage, which is focused on Africa, the Middle East and Russia, is understood to have rejected the offer worth 425p a share.

Bakery chain Greggs has enjoyed another strong session in the wake of its full-year results yesterday.

Greggs posted an 8% rise in profits and sounded hopeful about its ability to offset rising costs this year, prompting shares to lift another 37.45p to 503.75p.

The FTSE 100 has gained 102.2 to trade at 5,700.4.

14.45:

The FTSE 100 is now 96.2 points higher at 5694.4.

The strong start predicted for US shares has materialised, and the Dow Jones is currently 147.2 points higher at 11,760.58.

13.00:

At lunchtime, the FTSE 100 is doing its best to recover ground lost since the Japan disaster rocked global markets.

The Footsie is 77.7 points higher over the session at 5676. It seems the absence of more (very) bad news has been enough to encourage buyers.

Here's IG Index trader Anthony Grech: 'The FTSE has taken the view that 'no news is good news' and is piling on the points as investors hope for a rebound.'

Legal & General failed to benefit from the insurer's announcement of a 24% rise in its full-year dividend.

Analysts praised the results, which showed a 2% rise in group pre-tax profits, but shares were down 1.1p at 110p.

Other insurers fared better amid a better session for the wider market, with Prudential up 13.5p at 687p and Aviva 12.15p stronger at 433.4p.

Other risers included Royal Dutch Shell, which rose 64.25p to 2114.25p.

Roofing and insulation specialist SIG rose 7%, or 8.6p to 129.6p, in the FTSE 250 Index after it posted a 3% improvement in underlying profits and said it planned to resume dividend payments later this year. There's more on that here.

On Wall Street shortly, the Dow Jones is expected to open higher.

11.35:

We have more on Legal & General Group's upbeat results.

It delivered a confident growth forecast, predicting more people will develop a savings habit in reaction to Government austerity.

The stock is down 1.3p at 109.8p. Broker Panmure Gordon commented: 'The shares have been impacted by the recent market uncertainties but, in our view, this has created an excellent buying opportunity.'

Shares in rival Prudential are still ahead, up 11.5p at 685p.

The FTSE 100 is trading 34.5 points higher at 5,632.8.

10.50:

A strong start to the day has slipped and the Footsie is now 36.87 points higher at 5634.9.

In currency news, the Japanese yen has leaped. The yen has been strengthening ever since the earthquake and tsunami disaster last Friday, but last night it soared rapidly to 76.25 against the dollar - crashing through the previous record of 79.75, struck in 1995 in the months following the Kobe earthquake.

Here's more on that.

09.40:

The FTSE 100 made welcome gains today with better news from Japan helping insurer Prudential recover, although rival Legal & General was flat despite a dividend boost.

Hopes that Japan's nuclear crisis can be contained helped stabilise the London market today after a 7% slump since the disaster struck.

The Nikkei, which fell heavily on Monday and Tuesday before a rebound yesterday, slipped 1.5% in Tokyo but the decline was not as bad as earlier in the session.

The FTSE 100 Index has fallen for the past week but steadied today, up 51.4 points at 5649.65.

The top flight nosedived yesterday when EU's energy minister said Japan's damaged nuclear plant was 'out of control', before it transpired the comments were made a day earlier and were not based on new or privileged information.

The soothing news has helped insurer Prudential – the top riser this morning, 23p, or 3.4%, higher at 696.5p. The Pru was perhaps helped along by news of a profit rise and dividend boost at rival L&G.

Shares in Legal & General itself failed to benefit the announcement of a 25% rise in its full-year dividend. Analysts praised the results, which showed a 2% rise in group pre-tax profits, but shares were flat at 111.15p.

Investors have been swamped with unsettling news in recent days with unrest in Bahrain and disappointing US economic news adding to the Japanese worries.

In London, roofing and insulation firm SIG rose 5%, or 5.9p to 126.95p, in the FTSE 250 Index after it posted a rise in underlying profits and said it planned to resume dividend payments later this year.

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