FTSE 100 Reaches Highest Level Since September 2008

Share prices on the London Stock Exchange rose sharply during early trading on Monday, following a week that saw the FTSE 100 rise 3.5%, its best weekly performance since July.

Dominic Turner
shareprices.com - Monday, October 12, 2009

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BP

Indeed, the blue chip index reached its highest intraday level since September 2008 on Monday morning, up 51 points, or 1%, at 5,212.72.

Resource stocks led the way, with crude oil prices approaching $73 a barrel lifting oil majors BP and Royal Dutch Shell by 0.9% and 0.6% to 547.7p and £17.65 respectively.

Buying shares in insurance companies was also popular, with Legal & General, Old Mutual and Standard Life amongst the top ten risers. Vodafone also added 3% and, in fact, Invensys and Randgold Resources were the only FTSE 100 constituent companies significantly in the red. Barclays' shares remained flat at 376.9p, despite reports that it is to sell off a portfolio of toxic assets worth £4 billion in the next phase of cleaning up its balance sheet. Lloyds Banking Group., too, was down 0.6% at 93.5p after reports that it was closet to an £11 billion rights issue to be underwritten by UBS and Bank of America Merrill Lynch.

A report from the Centre for Economics and Business Research suggested that the U.K. Bank Rate would remain at 0.5% at least until the end of 2010 and below 2% until 2014, intensifying the pressure on Sterling. The pound hit a six-month low against the euro, at €1.0712 and a five-month low against the dollar at $1.5729.

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