FTSE 100 makes progress despite US economy concerns

The UK’s blue-chip index has made positive progression this morning aided by a banking surge following the rise of the pound by almost 40 pips against the dollar, a gain of 0.4 per for the day. Barclays (LON:BARC) and Lloyds Banking Group (LON:LLOY) are holding strong at the top of the FTSE 100 gainer charts with gains of three per cent despite concerns over the global economy being heightened last night by Ben Bernanke’s cautious comments.

Kate Neilson
shareprices.com - Thursday, July 22, 2010

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Barclays is one of the top gainers today

Bernanke, the Chairman of the Federal Reserve, warned last night that the US economy faced “unusually uncertain” prospects. The words sent stocks spiralling on Wall Street, and as the London market opened it looked as though the negative sentiment would ripple across the Atlantic.

However, the UK’s top index has posted significant gains this morning as a result of the pound growing in strength and strong retail results.

June retail sales were boosted by England’s shorter-than-expected involvement in the World Cup with electronics goods being the main driving force behind the increase – as they were in May with retailers offering deals on televisions to watch the football matches on. The gain in monthly retail sales reached 0.7 per cent, outperforming the forecasted 0.5 per cent gain.

Upholding the FTSE 100’s positive movement have been banking stocks, mainly Lloyds and Barclays. Lloyds moved to 62.99p from an opening price of 61.01, adding 3.25 per cent, and Barclays improved by 3.15 per cent to sit just shy of the 300p mark. HSBC (LON:HSBA) has also been performing well in morning trading, up 1.5 per cent.

Other strong gainers were miners despite a fall in prices. Precious metal prices retreated and base metals including copper and nickel fell, too. But despite this, copper miner Kazakhmys (LON:KAZ) is currently 2.7 per cent higher with a gain of 30p. Anglo American (LON:AAL) and Eurasian Natural Resources (LON:ENRC) are following in close proximity with gains in excess of two per cent as well. And Lonmin (LON:LMI) is the surprise mining stock as it is positing 2.3 per cent gains at the moment after the third-largest platinum producer said that quarterly production had stumbled by 47 per cent. This was due to a problematic leaking furnace and the firm may have to shell out as much as $17.5m to pay competitors to take over smelting in order to meet sales, it confirmed.

At the other end of the FTSE 100, Autonomy Corporation (LON:AU) continued a difficult week with shares declining over 11 per cent after a less-than-inspiring trading update. The software group’s share price fell earlier in the week in response to a poor trading update from IBM in the US, and it has suffered again after it reported a seven per cent rise in earnings per share in the three months to June 30.

The FTSE 100 share index is up by 0.9 per cent with a gain of 46 points to 5,261.16.

 

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