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FTSE closes up for fifth day running

Published 10/08/2016

Share prices displayed on a stock ticker screen in the London Stock Exchange in the City of London.
Share prices displayed on a stock ticker screen in the London Stock Exchange in the City of London.

London's top flight index scraped its fifth consecutive session of gains, with a rally from financial stocks keeping the market in the black.

The FTSE 100 Index closed up 15.12 points to 6866.42 after Prudential's stocks surged following a better-than-expected set of half-year results.

The insurance and investment giant rose more than 2% or 31p to 1423p after half-year operating profits lifted 9% to £2.06 billion, with analysts expecting £1.88 billion.

The firm brushed aside global market volatility and ultra-low interest rates thanks to a strong performance in Asia, where it recorded double-digit growth, with operating profits ticking up 18% to £743 million over the period.

The UK's top flight was also buoyed by a bounce back from Legal & General after it was hit with a sharp sell-off in the previous session following declines in its investment management, insurance and savings divisions.

However, investors moved to buy up stocks after warming to the insurer's 23% rise in profits for the first half of the year.

Shares were up more than 3% or 6.8p to 212.8p

A slump in the oil price was taking its toll on energy stocks after US crude inventories rose unexpectedly for a third straight week.

Brent crude was down 1.9% to 44.14 US dollars a barrel, causing oil majors Royal Dutch Shell and BP to drop 10.5p to 1984.5p and 2.2p to 423p respectively.

On the currency markets, the pound was marginally higher at 1.30 US dollars after falling earlier in the session when the Bank of England said it would press on with a £60 billion economy-boosting plan despite hitting an early stumbling block.

It faced a £52 million shortfall on Tuesday after it was unable to buy as many government bonds from City investors as needed under its new quantitative easing (QE) push.

However, the pound was 0.4% lower against the euro at 1.163 euros.

Across Europe, Germany's Dax was off 0.39%, while the Cac 40 in France slipped 0.36%.

In UK stocks, shares in Canada-based Entertainment One lifted 10% after it rebuffed a takeover approach from broadcasting giant ITV worth more than £1 billion.

The owner of popular children's TV character Peppa Pig did not name ITV as the suitor, but said it "unanimously rejected" a 236p-a-share proposal as it believes it "fundamentally undervalues" the group.

The FTSE 250 firm owns the rights to TV shows including Peppa Pig - the cartoon character who has turned into a global children's phenomenon.

It also owns more than 40,000 film and television titles, including last year's Oscar-winning hit Spotlight, and its Amblin Partners venture with Steven Spielberg is behind this summer's movie The BFG, based on Roald Dahl's classic children's book.

Shares in ITV were up 1.8p to 200.5p.

Remaining on the second tier, s hares in G4S rocketed 16%, or 31.6p to 227.2p, after the world's biggest security company reported a rise in profits.

The firm said pre-tax profits rose 9.7% to £203 million and revenue was up 3.2% to £3.5 billion after the firm secured new contracts worth £1.4 billion.

Some observers had pencilled in a cut in the dividend or a rights issue in order to tackle G4S's debts, but the company instead delivered a dividend of 3.59p per share and said its debt-to-earnings ratio had improved.

The biggest risers on the FTSE 100 Index were Rolls-Royce up 33.5p to 797p, Legal & General up 6.8p to 212.8p, Prudential up 31p to 1423p, Barclays up 2.5p to 163.7p.

The biggest fallers were Berkeley Group down 37p to 2613p, HIKMA Pharmaceuticals down 32p to 2268p, Sky down 11p to 887p, IAG down 4.7p to 402.5p.

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