FTSE 100 heading for its first positive session in a week

 

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The Independent Online

London's leading shares index is heading for its first positive session in a week after investors leapt on positive news from the US economy today.

A slight fall in weekly jobless claims was the trigger for the improved sentiment, which also raised hopes that the Dow Jones Industrial Average will end a six-session losing streak.

The FTSE 100 Index, which last night closed at a fresh low for the year, was up 24.2 points at 5554.8, even though traders predicted that fresh attempts to form a coalition government in Greece would fail.

The mood was helped by the decision of the European Financial Stability Facility to make a payment of 5.2 billion euros in emergency aid to Greece, while efforts continue to form a government in the country.

Meanwhile, the Spanish Economy Ministry said it will nationalise stricken lender Bankia, which has high exposure to bad property loans following a crash in the construction sector.

The government hopes its plan for the bank, which will be fleshed out further on Friday alongside other measures, will form part of a strategy to convince investors the country won't need a bailout.

Back in London, commodity stocks, which have been battered in recent days, attracted bargain hunters as Polymetal International topped the risers board, up 7% or 54.5p at 822p.

Away from the economic gloom, corporate news was largely positive as BT beat its £6 billion underlying earnings target one year ahead of schedule and said it planned to increase its dividend by up to 15% a year for three years.

BT shares fell 5p to 212.2p, after rising by more than a quarter in the past nine months, as investors expressed disappointment over a bigger-than-expected decline in revenues.

Outside the top flight, Dixons Retail Group jumped 0.75p to 18.2p after it announced a bigger-than-expected 8% jump in UK like-for-like sales and said it was on track for profits near the top end of City expectations.

SuperGroup recovered 6%, or 17.85p to 324.85p, as analysts said the sell-off in shares following a recent profits warning may have been overdone. New figures from the fashion chain still showed a 14.1% rise in retail sales for the 13 weeks to April 29.

Mecca Bingo owner Rank Group was also among the risers after it reported a 5% rise in like-for-like revenues in the 17 weeks to May 6.

Lower footfall at it Mecca Bingo halls was partly offset by growing online revenues, with a new bingo app for iPads encouraging more people to play online. Its casino arm also showed solid growth as its shares rose 2.45p at 115.65p.

PA

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