FRIDAY MARKET CLOSE: FTSE up on Greek deal hopes

Britain’s benchmark share index ended the week in positive territory after growing hopes that last-ditch reform proposals by Greece will lead to a bailout deal with its creditors.

A pro-European Union protester holds EU and Greek flags during a demonstration in front of the Greek parliament in Athens. Picture: AFP/Getty Images

The FTSE 100 rose 91.75 points or 1.4 per cent to 6,673.38, meaning blue-chip shares ended the week 87.6 points up as the chances increased of Greece agreeing a last-minute deal and preventing its exit from the euro.

It came at the end of a turbulent week for the top-flight which saw it shed more than 150 points in the first couple of sessions after a Greek referendum vote to reject the kind of measures that could have paved the way for a new bail-out for the indebted nation.

Chris Beauchamp, senior market analyst at IG, said: “The week is ending on a sunny note in London, and not just weather wise. All the problems of the past week appear to be slipping away.

“Chinese equities have bounced, Greece seems to have bowed to the inevitable and acceded to its creditors’ demands, and even the dollar is moving lower thanks to diminishing fears of a US rate hike.”

Official data from the construction sector struck a negative note, showing a 5.8 per cent decline in new housebuilding. The figures highlighted the challenge facing the industry as George Osborne set out plans to shake up house building rules – measures that helped cheer stocks in the sector.

Barratt Developments rose 11p to 631.5p while Charles Church owner Persimmon climbed 34p to 1,988p and Taylor Wimpey added 4.3p to 189.2p.

Also among the risers was British Airways owner International Airlines Group after Ryanair cleared the way for its takeover of Aer Lingus by agreeing to sell its 29.8 per cent stake in the Irish carrier. IAG shares climbed 3 per cent, or 16.5p to 531p.