Markets: Ford drives Footsie to 2-month high

THE Footsie closed at its highest level for more than two months yesterday after Ford's best first-quarter profits since 1998 provided direction during a light day for trading volumes.

The US car giant and technology firm 3M delivered quarterly figures that beat expectations in another round of strong US earnings.

Ford's figures provided the focus on the FTSE 100 Index in an otherwise quiet day for UK corporate news after the long Easter break, with the Footsie finishing 51.06 points higher at 6,069.36, a rise of almost 0.9 per cent.

David Jones, chief market strategist at IG Index, said: "Blue chips in London found fresh momentum in the afternoon as strong earnings from Ford lifted the Dow out to fresh 34-month highs, boosting investor sentiment over here."

The London market had got off to a subdued start, with investors holding back ahead of economic updates on both sides of the Atlantic today. In the UK, gross domestic product (GDP) figures this morning will reveal whether the economy rebounded in the first quarter of 2011,

Most commentators expect the US Federal Reserve to resist pressure to increase interest rates. The pound was weak amid nervousness over the GDP estimate. Sterling eased back to $1.65 and €1.13.

Banking shares were in the spotlight after Swiss giant UBS reported a strong quarter for its wealth management arm and as investors prepared for the release of first-quarter results from Barclays today.

Royal Bank of Scotland was up 0.04p at 41.8p, Lloyds Banking Group was ahead 0.5p at 60.4p and Barclays advanced 3p to 301.9p. Edinburgh-based insurance and pensions giant Standard Life closed up 2.7p at 215.1p ahead of tomorrow's first-quarter update after analysts at RBC Capital Markets revealed that its growth estimate for the insurance arm is 14 per cent ahead of City consensus figures.

British Airways parent International Consolidated Airlines Group soared to the top of the risers board on the back of lower oil prices and an upbeat note on the sector from analysts at UBS.

The group, formed when BA merged with Spanish carrier Iberia earlier this year, saw shares lift 5 per cent or 9.9p to 229.6p.

Luxury fashion house Burberry was not far behind, still benefiting from the positive set of results it released last week.

The 155-year-old maker of raincoats and handbags reported a 32 per cent surge in revenues to 390 million in the three months to March, which it said would result in full-year profits being at the top end of expectations. Shares were up 20p at 1,291p.

The heavily-weighted mining sector held back the market as commodity prices fell.Randgold Resources led the declines with a fall of 110p to 5,195p.

M&S food supplier Uniq made headway after it reported a return to annual underlying profits following a surge in sandwich sales.

The group, which also makes salads and desserts for companies including Costa Coffee and the Co-operative Group, made profits of 4.1m in 2010, compared to losses of 1.9m the previous year. Shares were up 3.4p at 78p.