TUESDAY MARKET CLOSE: ECB bond rumours boost risk assets

Reports that the European Central Bank (ECB) is to start buying corporate bonds gave markets a kick at the prospect of a belated cash injection on the Continent.

Apples earnings created a broadly upbeat atmosphere. Picture: Julie Bull

With traders in an upbeat mood and bargains to be had after the recent the sell-off, weakening Chinese growth was also interpreted as a possible precursor to monetary stimulus and helped the FTSE 100 jump 105.26 points to 6,372.33.

Chris Beauchamp, market analyst at IG, said: “Leaving aside the small point of whether the ECB is actually considering a new bond purchase programme, the reports of a possible plan were enough to give markets the additional momentum they needed, building on the broadly upbeat atmosphere created by Apple’s excellent earnings [published on Monday night].”

But chip designer Arm Holdings, whose technology is found in Apple devices, was the biggest faller in the top flight as its own third-quarter profits fell short of analysts’ expectations. Shares were more than 5 per cent lower, down 45.5p to 806p.

Household products group Reckitt Benckiser was also struggling, off 105p to 5,010p, after its like-for-like sales growth of 3 per cent for the third quarter came in below market forecasts.

The latest supermarket share figures from Kantar Worldpanel offered some comfort for Tesco shareholders after a sales fall of 3.6 per cent was hailed as a possible turning point. The figure was its best performance since June and sent the stock 6.6p higher to 185.9p amid hopes that Thursday’s results will not require the company to restate previous numbers.

Glasgow-based Weir Group was among the beneficiaries of firming commodity prices, including oil, on expectations that China will act to bolster growth. Its shares gained more than 4 per cent to 2,291p.