View the article online at http://citywire.co.uk/money/article/a588263
FTSE bounces on US jobs data, Greece bailout cash
Britain’s FTSE 100 makes gains on the back of stronger US jobs data and after the EU approves a key bailout payment to Greece.
Britain’s FTSE staged a slight bounce on Thursday, snapping a three-day losing streak, on the back of better-than-expected US jobs data and after EU officials approved a key bailout payment to Greece.
The UK index of blue-chip shares edged up 0.25%, or 14 points, to 5,544 – up from a day low of 5,491 – and the All Share index improved 0.41%, or 12 points, to 2,882. See the FTSE’s performance and the index’s top winners and losers.
‘Reassuring’ jobs figures
Official data showed earlier that initial claims for US unemployment benefits dropped from an upwardly revised 368,000 to 367,000 last week, the lowest level in a month. The average forecast in a Reuters poll called for an increase to 369,000.
Michael Gapen, economist at Barclays, branded the data ‘reassuring’. He added: ‘The fact that initial claims held their decline last week is supportive of the idea that the recent softness in initial claims has reversed.’
Wall Street welcomed the data, as investors shrugged off weak US trade figures. The Dow Jones Industrial Average added 0.43% to 12,891 and the Standard & Poor's 500 index hardened 0.21% to 1,358; but the Nasdaq Composite index was 0.01% lower at 2,933.
Spanish bank bailout
Meanwhile, the eurozone’s bailout fund agreed a payment of €5.2 billion (£4.17 billion) to Greece. The move ended uncertainty as to whether the fund would keep Greece afloat in the wake of the country’s general election, in which anti-bailout parties made substantial gains.
Greece’s stock market rebounded 4.2% to 641, as the yield, or implied interest rate, on benchmark Greek 10-year government bonds retreated 91 basis points to 24.07%. The government bond yields of other eurozone nations around which market fears have swirled of late – including France, Spain and Italy – also pulled back.
And other stock markets on the continent advanced, led by financial stocks: Germany’s DAX index rose 0.66% to 6,518, France's CAC 40 index climbed 0.37% to 3,130, and the FTSEurofirst 300 index of top European shares gained 0.44% to 1,019.
The gains also came after Spain took a 45% stake in Bankia, its third-largest bank by assets, amid mounting fears over the financial health of the country’s banking system.
But Polymetal (POLYP.L) was the biggest riser, adding 49p to 817p, following strong earnings from the Russian miner.
Elsewhere, sterling strengthened 0.19% versus the dollar to $1.616 and gilt yields rose after the Bank of England held off from announcing another round of monetary stimulus to prop up Britain’s faltering economy.
News sponsored by:
After Boris announced he was backing Brexit, sterling suffered its biggest slump in six years. Our Market Mavens discuss. Follow the Market Mavens LinkedIn page for weekly videos, in which our panel of industry experts share their views on financial news
The Citywire guide to investment trusts
In association with Aberdeen Asset Management
More about this:
Look up the shares
More from us
Tools from Citywire Money
From the Forums
Weekly email from The Lolly
Get simple, easy ways to make more from your money. Just enter your email address below
An error occured while subscribing your email. Please try again later.
Thank you for registering for your weekly newsletter from The Lolly.
Keep an eye out for us in your inbox, and please add email@example.com to your safe senders list so we don't get junked.