INVESTORS were cheered yesterday as stocks on both sides of the Atlantic surged on the back of strong corporate and economic news.<br /><br />In the UK, the FTSE 100 index leapt to a 10-month high, closing at 4,682.46 points, its highest level since the collapse of Lehman Brothers last September, while sterling rose on the back of strong half-year results from&nbsp; Barclays and HSBC.<br /><br />Barclays reported first-half pre-tax profits of &pound;2.98bn, up from &pound;2.75bn for the same period last year, sending its share price up 6.7 per cent to 322.55p.<br /><br />And HSBC said its pre-tax profits for the six months to the end of June hit $5.02bn (&pound;2.96bn), down from $10.25bn last year but still better-than-expected, helping its shares add 4.72 per cent to close at 634.51p.<br /><br />The strong results pushed sterling to a 10 month high against the dollar of $1.69 &ndash; &ldquo;an important psychological barrier,&rdquo; according to Mark O&rsquo;Sullivan of Currencies Direct.<br /><br />&ldquo;The pound is rallying on these releases, as confidence returns to the UK banking sector,&rdquo; he added.<br /><br />Meanwhile, the prices of the most traded risky loans in Europe and the US reached their highest level in over a year, in a sign that credit markets were also starting to improve.<br /><br />Over the past week, European leveraged loans hit 89.11 per cent of face value for the first time since July 2008, according to Standard and Poor&rsquo;s LCD and Markit. And US loans rose to 90 per cent of face value for the first time since June 2008.<br /><br />Meanwhile, stocks rose in the US, pushing the S&amp;P 500 index above 1,000 for the first time in nine months, as data on the manufacturing sector underscored optimism that the economy was recovering.<br /><br />And the Nasdaq closed above 2,000 for the first time since October on a strong earnings season.