FTSE Close: RBS, Barclays, Lloyds up

By THIS IS MONEY
Updated:

 

17.00 (close)

Financial Trading board

The FTSE 100 Index soared almost 3% to its best close since mid-May today as investors cheered news of better-than-expected results from banking giants HSBC and BNP Paribas.

The London market posted gains 2.6% or 139.1 points to 5397.1, while Wall Street's Dow Jones Industrial Average rose 2% higher after a twelfth successive month of growth for US manufacturers.

Banks were joined on the risers by many commodity-related stocks as crude oil pushed past 80 dollars a barrel on revitalised recovery hopes. The pound pushed to six-month highs against the dollar at 1.59, and approached 1.21 against the euro.

HSBC was the Footsie's best performing bank after lower levels of bad debts enabled HSBC to announce higher half-year profits of 11bn (£7bn).

It followed the lead of its French counterpart, which earlier reported second quarter earnings of 2.1bn euros (£1.7 bn), a rise of 31%. Despite the impact on revenues growth of recent stock market turbulence, shares in HSBC lifted 5% or 34p to 680p.

Lloyds Banking Group lifted 3.2p to 72.4p ahead of its results on Wednesday, which are expected to show £800m in profits in a mammoth turnaround on the £4 billion losses seen a year earlier.

Barclays added 11.15p to 343.95p and Royal Bank of Scotland lifted 2.1p to 52.1p as investors prepared for a total profits haul from the sector of more than £10bn in the first six months of the year.

Miners were also higher after weaker Chinese manufacturing data quelled fears Beijing might tighten controls to prevent its economy from overheating.

This encouraged the likes of Vedanta Resources to rise 127p to 2568p and Antofagasta to add 49p to 1037p.

Other notable risers included property firm Hammerson after it posted a 7% improvement in adjusted pre-tax profits for the six months to June 30.

The Bullring owner also became the first real estate investment trust to raise its dividend since the downturn in property markets, helping its shares improve 10.3p to 398.7p, a rise of 2%. The progress came despite the company remaining cautious about the economic outlook.

Quality checking firm Intertek was among the best performers after it upped its full-year forecasts and said it now expects to achieve organic revenues growth of mid-single digits this year. Shares responded with a 6% rise, up 97p to 1674p.

Outside the top flight, shares in Arena Leisure were down almost 7% after the racecourse operator highlighted concerns about a sharp reduction in the bookmakers' levy used to support the racing industry.

The potential hit to next year's fixtures list could hurt Arena, while it has already warned its profits in 2011 were likely to be £800,000 lower as a result of the funding shortfall. Arena's half-year underlying profits rose 25% to £2m, but this failed to prevent shares falling 2.5p to 34.5p.

The biggest Footsie risers were Petrofac up 78p to 1328p, Intertek up 97p to 1674p, Xstrata up 59.5p to 1075p and Tullow Oil up 69p to 1300p. The three Footsie fallers were Randgold Resources down 95p to 5635p, British American Tobacco down 6p to 2188p and Shire off 1p to 1454p.

12.30

The FTSE 100 index is 106.1 points higher at 5,364.3.

Banks are still dominating the leaderboard after lower levels of bad debts enabled HSBC to announce higher half-year profits of $11bn (£7bn) and follow the lead of its French counterpart BNP paribas, which earlier reported second quarter earnings of €2.1bn (£1.7bn), a rise of 31%.

Despite the impact on revenues growth of recent stock market turbulence, shares in HSBC lifted 5% or 31.9p to 677.9p. Lloyds Banking Group, which is due to report £800m in profits on Wednesday in a mammoth turnaround on the £4bn losses seen a year earlier, lifted 3.5p to 72.8p.

Barclays added 10.3p to 343.1p and Royal Bank of Scotland lifted 2.5p to 52.45p as investors prepared for a total profits haul from the sector of £8bn in the first six months of the year.

Miners are also strong, with Vedanta Resources rising 121p to 2562p and Antofagasta adding 37p to 1025p.

Outside the top flight, shares in Arena Leisure were down 4% after the racecourse operator highlighted concerns about a sharp reduction in the bookmakers' levy used to support the racing industry.

The potential hit to next year's fixtures list could hurt Arena, while it has already warned its profits in 2011 were likely to be £800,000 lower as a result of the funding shortfall.

Arena's half-year underlying profits rose 25% to £2m but this failed to prevent shares falling 1.5p to 35.5p.

09.30

The FTSE 100 index jumped by more than 1.5% today after a strong session in Asia and further gains for banking stocks.

The blue-chip index was up 88.1 points to 5,346.2 and offset losses seen on Friday after US figures showed weaker-than-expected economic growth in the second quarter.

Asian stocks rose after weaker Chinese manufacturing data quelled fears Beijing might tighten controls to prevent overheating.

Miners on the front foot included Kazakhmys with a gain of 56p to 1,272p while Antofagasta lifted 40p to 1028p.

Banks got off to a strong start after France's BNP Paribas posted half-year results at the top end of forecasts.

HSBC the best off, up 21.1p to 666.9p, after it said half-year profit more than doubled from a year ago as bad debts fell sharply, and Europe's biggest bank said it remained bullish on the outlook for emerging markets.

'We had some extremely strong figures from BNP first thing this morning which has now been consolidated by what we've seen from HSBC,' said Richard Hunter, head of UK equities at Hargreaves Lansdown.

'Bearing in mind that in terms of this week all five of the banks are going to be putting in their half year figures, HSBC are certainly raising the bar in terms of expectations for the rest,' Hunter said.

Royal Bank of Scotland lifted 2.9p to 52.8p, Barclays added 10.2p to 343.1p and Lloyds Banking Group rose 3.4p to 72.6p.

Other notable risers included property firm Hammerson after it posted a 7% improvement in adjusted pre-tax profits for the six months to June 30.

With analysts praising the Bullring owner for its strategy in the economic downturn, shares lifted 15p to 403.3p.

The flight to riskier assets meant utility stocks were left marooned on the fallers board. United Utilities dropped 3.5p to 581.5p and Centrica fell 1.4p to 302.5p.

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