FTSE rises despite Portuguese worries

Strong results from retailers Next and B&Q-owner Kingfisher pushed the London market higher yesterday and helped offset concerns over Portugal's debt crisis and the ongoing conflict in Libya.

The FTSE 100 Index also shrugged off worse-than-expected UK retail figures that revealed sales fell 0.8 per cent between January and February as shoppers were deterred by record price hikes.

The Footsie closed up nearly 85 points or 1.5 per cent at 5,880.87 after being boosted by strong performances from retailers and mining stocks.

The pound was down against both the dollar and the euro as the poor retail figures were perceived to lower the chance of an imminent hike in interest rates. Sterling fell to €1.14 and $1.61.

Will Hedden, sales trader at IG Index, said: "The UK's leading index retailers seemed unaffected by the morning's disappointing sales data."

Next was up 4 per cent or 78p to 2,043p after it posted a 9 per cent increase in pre-tax profits to 551 million. Kingfisher rose 17.6p to 2,61.4p after it saw profits grow 23 per cent to 670m and hiked its full-year dividend to shareholders by 28 per cent to 7.07p. Both groups enjoyed profit upgrades from analysts. Other retailers were also up as the figures boosted sentiment on the sector. Marks & Spencer surged 12.6p to 358.1p and Primark owner Associated British Foods was ahead 22.5p at 100p.

Mining stocks offered further support to the market as metal prices, including aluminium and copper, hit three-week highs yesterday.

Anglo American was up 67.5p at 3,184.5p, silver miner Fresnillo was ahead 41p at 1,533p and platinum firm Lonmin added 31p at 1,670p.

Oil prices continued to rise as air strikes in Libya intensified and reports that Middle Eastern pipelines had been shut down emerged, sending Brent crude back up to $115 a barrel.

Elsewhere, Resolution - the owner of life and pensions firm Friends Provident - advanced 2 per cent after reporting record sales at its Lombard wealth management business.

Resolution said the strong performance at Lombard, and its international arm, helped offset a weaker show at Friends Provident. Shares were up 5.1p at 289.3p.

BT also made slight gains, despite a profit warning from rival Cable & Wireless Worldwide. BT shares were 1.1p higher at 181.5p, although Cable & Wireless dropped 0.8p to 48.5p on the FTSE 250 Index after it said earnings for its next financial year would likely remain flat.Engineering firm Invensys headed the top flight's fallers' board, down 16.1p to 341.2p, after shocking the City with news that chief executive Ulf Henriksson has stepped down.

Imperial Tobacco was also in the red, down 12p to 1,910p, after it said first-half cigarette volumes were expected to fall by around 1 per cent.

Scottish sausage skin maker Devro gained 6.1p to 280.3p after presenting its annual financial report to shareholders.

Aberdeen-based transport firm FirstGroup was up 2.5p at 334.6p after the Department for Transport confirmed that it had pre-qualified to bid for the new West Coast rail franchise, which is expected to start in April 2012.