London shares gain on early US lead

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Events on the other side of the Atlantic helped the Footsie build on recent gains yesterday as US indices hit record highs in early trading.

Chris Beauchamp, market analyst at IG, said: “The FTSE 100’s charge back to its highs for the year continued unabated, after another drop in US employment claims emboldened investors and sent the index firmly through 6,600. After a few days languishing in the sun, investors seem to have recovered their summer optimism.”

London’s top shares index added almost 1 per cent, up 62.43 points at 6,634.36.

The banks got an added push from over the Pond as Morgan Stanley became the latest among their US peers to beat expectations for the reporting season now underway in New York. Royal Bank of Scotland was up 4 per cent at 334.4p and Barclays was 2.4 per cent firmer at 317.05p.

With Morgan Stanley’s share trading division turning in a particularly strong performance, Aberdeen Asset Management also felt the favourable wind, adding 16.5p to close at 414.7p

Advertising and marketing giant WPP was also among London’s biggest risers after French rival Publicis said half-year profits rose by 15 per cent, adding that recent signs of economic slowdown in China and Brazil were not impacting on its business. The update came as a relief to investors in the world’s biggest advertising firm – owner of agencies Ogilvy & Mather and Burson-Marsteller – as WPP is due to post its own half-year figures next month. Shares rose 42p to 1,210p, up 3.6 per cent.

EasyJet was also flying high, with shares soaring 56p to 1,406p on the back of a broker upgrade from JP Morgan.

NEW YORK: The Dow and the Standard & Poor’s 500 ended at record closing highs last night as Morgan Stanley and others reported better-than-expected earnings and Federal Reserve chairman Ben Bernanke’s comments further reassured markets.

The Dow Jones industrial average rose 78.17 points, or 0.51 per cent, to end at 15,548.69 while the S&P 500 gained 8.46 points, or 0.50 per cent, finishing at 1,689.37. The Nasdaq Composite Index added just 1.28 points, or 0.04 per cent, to close at 3,611.28.

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