THURSDAY MARKET CLOSE: Retailers bring much-needed cheer to City

London’s top-flight index scraped into positive territory as strong gains among retail stocks helped to offset disappointing economic growth data.

Mike Ashley’s Sports Direct chain led the way, rising 27.5p or 4.2 per cent to 686p on the back of a profit upgrade that will trigger a bumper share payout for staff in its bonus scheme.

B&Q parent Kingfisher was another strong gainer, despite the weaker euro contributing to a 4.8 per cent fall in first-quarter retail profits to £150 million. Shares added 8.2p or 2.2 per cent to close at 375p as the firm said its Screwfix arm had put in an “excellent” performance.

The FTSE 100 Index ended the session 7.59 points higher at 7,040.92 despite official data confirming first-quarter GDP growth of 0.3 per cent, wrong-footing many economists who predicted an upgrade to 0.4 per cent.

Tony Cross, market analyst at Trustnet Direct, said the weaker-than-expected output “is again pushing back the timing of any rate hike, which in turn translates into good news for equities”.

Elsewhere, British Airways owner International Airlines Group lifted 7p to 569p after telling investors it would not up its £1 billion offer for Aer Lingus amid speculation that major stakeholder Ryanair will play “hard ball” over the deal.

Scandal-hit outsourcing firm Serco dipped 0.2p to 136.9p as it named Sir Roy Gardiner, former chief executive of Scottish Gas parent Centrica, as its new chairman. He will replace Alastair Lyons on 1 July.

Smart Metering Systems, the energy meter supplier, said revenues were boosted by its expanding portfolio of assets, and shares in the Glasgow-based company rose 2.5p to finish the session at 349.5p.

Oil and gas firm Ithaca edged down 0.25p to 52p following a claim from a law firm relating to the schedule for completing a floating production facility. The company said it “strongly denies any suggested wrongdoing”.