This week’s Footsie fightback gathered pace yesterday as bullish traders seized on signs that the European Union will extend the bailout programmes of Portugal and Ireland by seven years as a reason to buy into the financial sector.
Banking stocks across Europe jumped sharply, with Barclays and Royal Bank of Scotland leading the charge in London, both surging more than 4 per cent at 298.25p and 285.4p respectively.
Michael Hewson, senior analyst at CMC Markets, said: “Airline stocks are also showing good gains led by FTSE new boy EasyJet after Citigroup analysts suggested that there could well be another 20 per cent upside in the share price, due to the prospect of future special dividends.”
EasyJet has been one of the highest flyers of recent months, with a 50 per cent surge in value since the start of the year wining the budget carrier entry into the blue chip index. It added a further 6.7 per cent or 68p yesterday at 1,090p. Upmarket rival IAG was also given a lift, with the BA-owner adding 5.8 per cent at 250.9p.
The FTSE-100 index added 74.16 points or 1.2 per cent at 6,387.37, as a big jump in Chinese import figures gave heavily weighted miners a boost.
Vedanta Resources led the way after reporting increases in production in copper, aluminium and silver. Its shares put on 63p to close at 1,179p.
But precious metals duo Fresnillo and Randgold were left propping up the fallers’ board, down more than 2 per cent each at 1,323p and 5,340p after broker Deutsche Bank cut its price targets on the pair.
Shares in temporary power provider Aggreko edged up 26p to 1,767p. Shareholder advisory group ISS recommended investors vote in favour of the firm’s remuneration report, contradicting calls from fellow advisor Pirc, which has argued for an abstention.
In New York, stocks climbed almost 1 per cent on Wednesday, with both the Dow and the S&P 500 ending at historic highs as cyclical shares led the way upwards for a second straight day.
The Dow gained 128.78 points, or 0.88 per cent, to end at 14,802.24. The Standard & Poor’s 500 Index .SPX rose 19.11 points, or 1.22 per cent, to finish unofficially at 1,587.72.