FTSE rise fuelled by solid earnings
The FTSE 100 pushed higher in early deals, recovering some of the previous session’s falls as investors turned their attention to a European Central Bank (ECB) meeting and tomorrow’s key US jobs report.
ECB chiefs meet today after a week in which a string of bleak economic data, including manufacturing figures, has cast a shadow. And figures out today showed that the UK service sector grew more slowly than expected in April as clients remained cautious.The main Markit/CIPS Purchasing Managers’ Index (PMI) for the service sector – measuring the change in business activity such as income or chargeable hours worked – fell to 53.3 from 55.3 in March.
But another flood of earnings provided the main direction on London’s blue chip index with medical products firm Smith & Nephew the top riser. The company was up 2.4 per cent in early trading after reporting a rise in profits. Sugars and sweeteners firm Tate & Lyle nudged up 1.7 per cent while consumer products giant Unilever lifted by 1.5 per cent.
Imperial Tobacco gained 1.4 per cent after yesterday announcing a £500m share buyback in tandem with growing revenues. Supermarket giant Morrisons also nudged up despite reporting a dip in sales.
In banking Lloyds was up just over one per cent while Barclays and RBS were broadly flat.
On the downside miners took a hit with Antofagasta dropping by 4.6 per cent after its copper output was hit in the last quarter. Gold miner Randgold Resources dropped 1.5 per cent despite saying that its gold production was on target even though operations at its key Mali mines had been under threat from a coup.
British gas giant BG Group was off by 2.9 per cent after announcing that it had offloaded its Brazilian Comgas unit for £1bn. Steelmaker Evraz was down 1.5 per cent as commodities were weak early in the trading session.
Packaging firm Rexam dipped by 0.5 per cent after investors gave a negative reaction to an update in which it said it was trading in line.
In Asia the Nikkei closed up 0.3 per cent and the Hang Seng down 0.2 per cent.
April’s US jobs report will be released tomorrow and is seen as one of the barometers of the state of the country’s economic recovery.