Markets: Euro deal helps some banks recover

By GARETH MACKIE
Published on 30/06/2012 00:00

Banking stocks were among the biggest risers in London yesterday as European leaders thrashed out a deal to cut borrowing costs and inject aid directly into the eurozone’s stricken banks, but scandal-hit Barclays remained out of favour.

Royal Bank of Scotland, whose boss Stephen Hester said he was waiving this year’s bonus because of the group’s computer systems debacle, surged 8.9p, or 4 per cent, to end the session at 215.3p. Lloyds Banking Group was also up 4 per cent, adding 1.16p to close at 31.1p. But Barclays, which saw more than £3 billion wiped off its market value on Thursday amid fears that its £290 million rate-rigging fine might be dwarfed by multi-billion pound legal claims, lost a further 2.75p to finish at 162.85p.

The FTSE 100 ended the day 78.1 points higher at 5,571.2, but water and waste group Pennon did not fare well during its first day of trading in the blue-chip index as UBS started coverage on the stock with a “neutral” rating. The owner of South West Water and recycling firm Viridor was promoted to the Footsie following International Power’s takeover by GDF Suez, and was the biggest faller with a 2 per cent decline to 762p.

Outside the top flight, online bookmaker Betfair saw its shares rise 2 per cent to 748p after it revealed £1bn had been bet on the Euro 2012 football championship, breaking records for the value gambled on a single sporting event.

Interactive whiteboard maker Promethean World was sent to the back of the class after a profit warning sent its shares plunging more than 36 per cent. The firm said its full-year results will be significantly below previous expectations because of lower demand in Europe and the US and its shares closed at 22p – a far cry from their year high of 75.5p.

NEW YORK: Wall Street surged last night to close out a sour quarter on a high note as investors cheered an agreement by European leaders to stabilise the region’s banks.

The Dow Jones industrial average shot up 277.83 points, or 2.20 per cent, to end at 12,880.09 while the broader Standard & Poor’s 500 Index climbed 33.12 points, or 2.49 per cent, to finish at 1,362.16.

The Nasdaq Composite Index jumped 85.56 points, or 3.00 per cent, to close at 2,935.05.