Global markets were back on the front foot today as investors took heart from reassuring comments by the next boss of the United States Federal Reserve and recovered some of Wednesday’s heavy losses.
Janet Yellen, who takes over from Ben Bernanke at the end of January, said the Fed has “more work to do” to help the US economy, easing market jitters about the tapering of asset purchases.
The FTSE 100 index climbed 36.13 points or 0.5 per cent to 6,666.13 while stock markets in Germany and France surged ahead by more than 1 per cent.
IG sales trader Will Hedden said: “There’s some hope that Yellen will prove to be the second coming of Bernanke, and that means a continuation of the easy money, long equity trade that has worked so well in recent months. Based on what she’s said, it seems they won’t do anything especially soon.”
Aberdeen Asset Management rose 12.3p to 419.2p after reports that the fund manager had ruled out making a cash offer for Scottish Widows Investment Partnership (Swip), even if its all-share bid is trumped, with Australian investment bank Macquarie reported to be eyeing Swip.
Outsourcing firm and former FTSE 100 stock Serco suffered a dramatic 16.9 per cent plunge after it warned that profits for this year will be below market expectations. Shares were down 84.9p to 419.1p.
Trinity Mirror, which publishes the Daily Record and Sunday Mail newspapers, surged by 20 per cent after reporting “improving revenue trends”. Shares closed up 28p at 166p.
Supermarket chain Sainsbury’s enjoyed a second day of gains in the wake of yesterday’s well-received 7 per cent rise in half-year profits, as a clutch of broker upgrades lifted the stock higher still.
Shares rose a further 3.9p to 414.6p, despite a £1 billion price-cutting strategy unveiled by US-owned rival Asda, which saw other grocers lose ground.
Tesco slipped 8.6p to 356.2p while Morrisons fell 7.8p at 266.2p. Drinks can maker Rexam fell 2.1 per cent or 12p at 506.5p, after it warned on the outlook for trading in Europe