FTSE close: RBS, easyJet up; Amec down

 

17.05 (close)

Dealers monitor their screens on the trading floor of IG Index in London

World markets saw a turnaround in fortunes today after better-than-expected jobs data from the United States calmed nerves about the global economy.

Wall Street's Dow Jones Industrial Average surged 1% after the US Labor department said the economy added more than 200,000 jobs in April for the third straight month, the biggest hiring spree in five years.

The FTSE 100 Index jumped 56.8 points by the close to 5976.8 after volatile commodity prices saw the market spend much of the session in the red.

The better-than-expected jobs data will offer some respite for investors after an unexpected jump in unemployment claims in the US, reported yesterday, triggered a plunge in oil and metal prices.

Elsewhere, a surprise fall in German factory orders and signs China and India's economic growth engine was losing steam also troubled commodity traders.

The slide moderated today as Brent crude oil, which fell nearly 10% yesterday, settled at 113 US dollars a barrel, while gold and silver prices recovered losses.

The improved sentiment saw a bounceback for heavily weighted mining stocks with Anglo-American adding 111p at 3056p, Vedanta Resources advancing 70p to 2194p and Xstrata up 32p to 1442p.

Banking stocks were on the front foot after Royal Bank of Scotland's first quarter results showed signs of progress.

While losses of £116m were steeper than last year, chief executive Stephen Hester assured investors RBS was on the road to recovery as its shares lifted nearly 6% or 2.3p to 42.7p, placing it on top of the leaders' board.

This helped the banking sector regain some of yesterday's losses after Lloyds Banking Group slumped to a first quarter loss after putting £3.2 billion aside to cover payment protection insurance compensation.

Lloyds was up 0.6p to 54p, while HSBC cheered 5.5p to 651.7p and Barclays added 1.3p to 277.6p.

International Airlines Group also impressed after the merged British Airways and Iberia company posted a sharp fall in first quarter losses.

Analysts said the results were better-than-expected, despite a surge in fuel prices, and led to a 3% rise in the company's share price, up 8.1p to 254.1p.

FTSE 250-listed airline easyJet, which will present half-year figures next week, benefited as its shares jumped 12.2p to 355.1p, or 4%.

Car insurer Admiral was another leading blue-chip riser after it said sales leapt 56% to £539m during a "great" first quarter.

It is on track to at least meet City profits expectations as the firm behind Diamond and elephant.co.uk said the number of vehicles it insured in the UK increased 33% to 2.9m.

Shares in Cardiff-based Admiral rose 2% - or 35p to 1697p.

The biggest FTSE 100 risers were Royal Bank of Scotland up 2.3p at 42.7p, Arm Holdings ahead 28p at 595p, ITV up 3.5p at 75.6p and Anglo American ahead 111p at 3056p.

The biggest fallers were Man Group down 5.8p at 247.4p, Scottish & Southern Energy off 23p at 1307p, Inmarsat down 10p at 593p and Amec off 19p at 1163p.

15.40: The FTSE 100 is up 29.3 points at 5,949.32 as the end of the trading session approaches, while in the US the Dow Jones is 150.9 points higher at 12,735.1.

Joshua Raymond, market strategist at spreadbetter City Index, said: 'The US jobs data has left a positive spin to the end of the week's session and has been enough to encourage investors to pick up some of the more badly beaten stocks that they perceive to be bargains.

'Investors are taking these figures as a good set of numbers, with US jobs gaining the most in just under a year, whilst the consistency in the growth of non farm payrolls is also pleasing.'

Nonetheless, Raymond warned that with the unemployment rate stubbornly high at 9%, there was some way to go in the US labour market recovery.

We've already looked back at the week just gone, but what lies ahead?

Check out our market diary for what to expect from corporate and economic announcements next week.

14.45:

As we head into the weekend, the Footsie is staring at a 100-plus loss on the week.

With a couple of hours left the FTSE 100 is 20.57 points higher today at 5940.55, having closed last week at 6069.90. And it would have been much worse but for strong US jobs numbers earlier this afternoon.

However, a case can be made that equities have proved remarkably resilient in the face of some pretty dismal economic and corporate news.

The week started with a brief panic over the fallout from the killing of Osama Bin Laden, with oil fluctuating as traders wondered if Middle Eastern supply would become less certain.

Losses were shortlived, with traders perhaps reasoning that the region couldn't be much more unstable than has been already this year, during which time supply seems to have held up just fine.

However, fears over growth in the US, India and China combined to push commodity prices lower. Thursday saw a dramatic fall right across resources.

In the UK, a slowdown in manufacturing put a question mark over GDP, while the Bank of England once again showed it's anxiety about growth when it held rates at 0.5% for the umpeenth month in a row.

Meanwhile, index giant Lloyds Banking Group suffered after it announced that it has been forced set aside a whopping £3.2bn to settle expected claims for mis-sold payment protection insurance.

All in all, it's been a testing week.

14.00:

Wow! The boost from those positive US jobs numbers (see 13.30) has been immediate, adding more than forty points to the Footsie in the moments after the data was published.

After languising in negative territory all day, the FTSE 100 is now 19.78 points higher at 5939.76.

13.30:

The FTSE 100 remains 24.64 points lower at 5895.34.

However, things may improve thanks to better-than-expected US non-farm payrolls data. The Labor Department said there were 244,000 American jobs created in April, the biggest increase in almost a year.

The cloud on the horizon was that the unemployment rate rose to 9.0%.

Predictions that the jobs numbers would be worse were partly responsible for the steep falls in commodity prices yesterday. Let's see if the improved jobs picture can correct some of those losses.

12.20:

The FTSE 100 is trading 18.8 points lower at 5,901.2.

Will Hedden, sales trader at spreadbetter IG Index, commented: 'After a shaky start, the FTSE is finding a degree of support but remains in negative territory.

'The ongoing rout on resource prices is weighing across the board in London, with energy stocks bearing the brunt; crude oil is rebounding off early lows though, suggesting that some have already called the bottom.'

Rentokil Initial is one of today's risers, up 2.2p at 93.25p, despite reporting a 10.1% drop in first quarter adjusted pre-tax profit.

The company has taken a £4.8m hit from the suspension of a rat-catching contract in strife-torn Libya, it revealed. We have more here.

Brent crude is off its earlier lows at just over $108 per barrel. Gold was fixed this morning at $1,487.75 an ounce compared with $1,511 at the previous close.

Futures trading indicates a modest rise in US stocks at the market open, but investors will remain wary until key jobs data is announced later.

11.20:

The plucky Footise is clawing back some of the losses from earlier today - now 22.27 points lower at 5897.71.

Highest riser has been Royal Bank of Scotland. Q1 results showed worsening losses after blows from the Irish debt crisis and charges for government protection on toxic assets.

The bank, 83%-owned by the taxpayer, also revealed that it expects claims for mis-sold payment protection insurance to have a 'material' on its balance sheet.

However, it also revealed better-than-expected operating profits of £1.1bn, compared to £55m in the last quarter. Markets have jumped on that good news and RBS shares are 2.13%, or 5.26%, to 42.61p.

Here's more detail on the RBS results.

We've also got more on the dramatic falls in commodity prices this week. End of the commodities boom? Have a look.

10.25:

The FTSE 100 headed south again on Friday with gloomy data knocking commodity prices and mining stocks, although RBS led a rally for financial shares.

By mid-morning the Footsie was languishing 37.32 points lower at 5882.66, dragged down by its weighting toward the miners.

Brent crude oil fell by almost 9% yesterday, down $9.99 to $111.24 a barrel, while gold was 2% lower at $1,511.

The recent blow to confidence has resulted in silver falling around 30% in little more than a week, while New York crude oil last night dropped below the £100 mark for the first time since mid-March.

Prices generally have steadied today although oil continues to fall and is currently a further 5% lower at $106, marking a week-long losing streak.

Thursday was the fourth day of widespread commodity falls with prices tumbling in response to a slew of negative economic data.

The latest and heaviest blow has been disappointing US jobs data which showed new claims for jobless benefits rose by 43,000 to 474,000, the highest since August, while productivity growth slowed. Economists had expected jobless claims to fall.

The official Labor Department non-farm payrolls figures will be released later today.

On a positive note this morning, it has been a decent session for banking stocks after Royal Bank of Scotland's first quarter results showed signs of progress.

While losses of £116m were steeper than last year, chief executive Stephen Hester assured investors RBS was on the road to recovery as its shares lifted 1.6p to 42.1p.

International Airlines Group also impressed after the merged British Airways and Iberia company posted a sharp fall in first quarter losses. Analysts said the results were better-than-expected and led to a 2% rise in the company's share price, up 5.9p to 251.9p.