FTSE close: HSBC up; Barclays, Vodafone down

By ADRIAN LOWERY
Updated: 11:55 EDT, 10 November 2009

Trading updates from two high street banking giants reassured the wider market today, as the Footsie stayed in the black for most of the day.

The FTSE 100 index was initially boosted by strong gains on Wall Street the previous session, in which the Dow Jones industrials average rose to its highest in 13 months. But it failed to sustain the gains throughout the day, closing 4.63 points down at 5,230.5.

Shares in Barclays and HSBC went different ways after they both updated the market on trading.

HSBC led the London market higher, gaining 4.25% or 29.4p to 721.6p after it reported an improved trend on bad debts and said results were 'significantly ahead' in the quarter to September 30.

Barclays also delivered a better underlying performance but shares dropped 2.9% or 10p to 332.85p as analysts said trading in its investment banking arm was slightly weaker than expected.

The Footsie clung to positive territory despite a near-4% slide for Vodafone after the mobile phone giant warned of intense pressure in its key Indian market. Shares fell 1.2p to 136.75p as results for the half year were in line with expectations, helped by earlier-than-expected cost savings of £1bn.

One of the biggest gains in the top flight came from Imperial Tobacco after the JPS maker announced the appointment of chief operating officer Alison Cooper as replacement for long-time chief executive Gareth Davis.

The company, which posted a 39% rise in annual profits to £2.2bn, saw shares climb 47p to 1875p, a gain of 2.57%.

Meanwhile, orthopaedics and medical instruments firm Smith & Nephew was also a prominent Footsie riser, adding 10.5p to 558.5p as Goldman Sachs lifted its target price on hopes for improving conditions in US markets.

The leading top-flight faller was gold mining firm Randgold Resources, which fell 202p to 4577p or 4.23% after disappointing with third-quarter results. Numis brokers slapped a sell rating on the stock.

In the FTSE 250 index, directories firm Yell surrendered a promising start seen after it announced another landmark in its balance sheet restructuring. It now plans to raise £660m from investors, more than the £500m signalled last week, but shares were 1.25p higher at 46.25p, rising almost 3%.

Industrial products firm Cookson led the second-tier risers board after it said it expected profits for this year to be at the upper end of market forecasts.

Arbuthnot Securities said it expects to upgrade its recommendation to 'Buy' from 'Neutral' and increases its estimate for 2009 adjusted pretax profit to £71m from £45m. Shares jumped 9.27% or 36.5p to 430.1p.

'We can now look forward to a highly-geared recovery in earnings and we expect the shares to be strong today,' analyst Michael Blogg says.

The market was supported by wider economic news, with a leading survey showing house prices in England and Wales rising last month at their strongest rate in almost three years, buoyed by tight supply and record low interest rates.

Another poll showed UK retail sales values rose last month at their fastest annual pace since April to notch up their best October showing in seven years.