Barclays gains on ‘cold’ view of cuts

By DOMINIC JEFF
Published on 09/03/2013 02:41

London traders were unfazed by news of sky-high bankers pay yesterday as they concentrated instead on reports that Barclays is planning job cuts and pushed shares in the sector higher.

Comments from chief executive Antony Jenkins that he foresaw 40,000 fewer jobs at the bank helped Barclays gain almost 3 per cent at 318.6p.

Michael Hewson, senior analyst at CMC Markets, said: “A rather cold-eyed reaction, but the fact is lower fixed costs are always well received by investors who take the view that returns become much easier to achieve if costs are kept under control.”

Also doing well was HSBC following the latest “buy” note from Nomura, which highlighted the group’s strong capital position and improving revenue outlook. The shares were 2.6 per cent higher at 737p, while the improved sentiment helped Royal Bank of Scotland add 1 per cent to 306.2p.

With supportive economic data coming first from China and then the US, the rally in the wider market continued with the FTSE 100 Index gaining new five-year highs, climbing 44.4 points to close at 6,483.6.

There was a recovery for Aviva shares after the insurer’s slump on Thursday when it slashed its dividend. Shares rebounded 10p to 324.8p as analysts suggested it was a buying opportunity, while rival Standard Life continued its post-results improvement with a gain of 8.1p to 381.1p.

On the downside temporary power provider Aggreko gave back some of the previous session’s meteoric gains. It lost 60p or 3 per cent at 1,879p.

Gold mining stocks were hit after a number of investment banks went negative on the gold price. Randgold Resources sliped 1.3 per cent to 5,445p.

NEW YORK: Wall Street closed out a historic week last night, as the Dow hit yet another closing high on a US payrolls report that surpassed even the most optimistic forecasts.

The Dow Jones industrial average was up 67.58 points, or 0.46 per cent, to end the day at 14,397.07 while the broader Standard & Poor’s 500 Index closed up 6.92 points, or 0.45 per cent, at 1,551.18. The Nasdaq Composite Index was up 12.28 points, or 0.38 per cent, to close at 3,244.37.