FTSE rises as investors shrug off eurozone fears

The top share index in the UK rose on Tuesday with the market ignoring the concerns over Italy's economy. By the end of the session, the FTSE 100 was higher by 1 per cent, adding more than 56 points to reach 5616.

Chris Bradshaw
shareprices.com - Tuesday, November 08, 2011

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The situation in Italy remains increasingly precarious with bond rates rising to 6.75 per cent and the Prime Minister, Silvio Berlusconi's grip on power is weakening by the day, paving the way for a shared-party government. But economists warned that Italy has a lot of work to do to save itself from a Greece-style collapse and should the worst happen, the consequences would be severe for nearly all EU countries, including those not in the single currency.

Lloyds Banking Group was the star performer of the day, rising by 4.37 per cent despite announcing £3.9 billion losses for the first three quarters of 2011. However, financial experts said the results were expected and the fact there were no unpleasant surprises was sufficient to boost the share price.

Another strong gainer was Associated British Foods which rose by 1.4 per cent with investors citing the group's defensive qualities as an attractive feature in the current economic climate.

Not faring quite as well on Tuesday was AstraZeneca which was the heaviest faller of the day, losing 3.15 per cent after its new drug bombed during a clinical trial.

International Consolidated Airline Group's decline continued, dropping by 1.94 per cent as the markets continued to hammer the firm over its recent proposed acquisition of BMI.

 

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