Markets: Jobs news and Bank minutes lift FTSE

By DOMINIC JEFF
Published on 18/07/2012 22:18

NEWS that British firms created thousands of jobs even as the economy contracted bolstered the market today, suggesting businesses are in better shape than the gross domestic product (GDP) data might suggest.

Shares were also supported by Bank of England minutes that showed it is actively considering a further interest rate cut to try and kick start the economy.

Angus Campbell at Capital Spreads said: “On the one hand you have an improving labour market and on the other you have the central bank looking at further measures to ease monetary policy, as well as a government assisting by spending on infrastructure projects. All this combines to provide a number of compelling reasons for investors to buy equities.”

The FTSE 100 index was up 56.7 points or 1 per cent to close at a two-week high of 5,685.8, thanks to late gains inspired by a positive opening in the US.

Mining stocks were given a lift by positive results from BHP Billiton and Fresnillo, which were up 2 per cent and 1.6 per cent respectively at 1,819p and 1,430p.

Shares in under-fire security firm G4S enjoyed a reprieve as bargain-hunters bought into the battered stock.

The firm, whose boss Nick Buckles admitted to MPs on Tuesday that its Olympic staffing debacle had been a “humiliating shambles”, closed 4.9p higher at 244.9p having fallen sharply over the previous four sessions.

Weir Group was among the few fallers after broker Nomura initiated coverage with a “reduce” recommendation, predicting the firm’s oil and gas division will see revenues decline by 6 per cent this financial year. Shares in the Glasgow-based company were down 11p at 1,491p, despite oil prices reaching a seven-week high.

NEW YORK: The S&P 500 touched its highest level since early May as corporate profits from bellwethers like Intel and Honeywell defied Wall Street fears of a collapse in earnings.

The Dow Jones industrial average was up 102.10 points, or 0.80 per cent, to close at 12,907.64 while the Standard & Poor’s 500 Index was up 9.07 points, or 0.67 per cent, closing at 1,372.74. The Nasdaq Composite Index finished up 32.56 points, or 1.12 per cent, at 2,942.60.