Banking shares rise on FTSE 100 as UBS fined $1.5bn

The blue chip index moved towards nine-month highs this morning, as optimism of a US budget deal boosted the FTSE 100.

Financial shares were in the spotlight, as Swiss bank UBS agreed a $1.5bn (£940m) fine for manipulating the Libor benchmark. The redress was in line with expectations, and UBS shares were trading around 0.3 per cent in Zurich this morning.

Headline UK banking shares were up early deals, with RBS, Lloyds and Old Mutual all rising.

RBS added 1.88 per cent, Lloyds Banking Group rose 1.97 per cent, HSBC increased 0.97 per cent and Barclays was up 1.14 per cent.

On the FTSE All-Share, computer security firm NCC Group added 9.34 per cent in early deals.

Hard coal and coke producer New World Resources jumped again today, soaring almost six per cent as the International Energy Agency said that coal could equal oil as the world’s top energy source in 10 years.

South African miner Aquarius Platinum and Finnish miner Talvivaara rose 5.79 per cent and 3.52 per cent in early trading.

At the other end of the spectrum, distribution firm Bunzl was the largest blue-chip faller, dropping 4.5 per cent. This morning it said trading was in line with expectations as it snapped up two businesses in Australia and Canada.

Miner Centamin was one of the largest fallers on the FTSE All-Share. Over the past week its shares have yo-yoed on problems at its Sukari mine in Egypt.

Credit card insurer CPP Group, which was the subject of a regulatory probe, said this morning it continued to trade profitably, although its shares fell 5.5 per cent in early deals.

In Asia, the Nikkei sailed through the 10,000 level to close 2.39 per cent up, while in the US the Dow Jones closed 0.87 per cent up