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Soaring RBS props up FTSE ahead of US jobs figures

Soaring RBS props up FTSE ahead of US jobs figures

Royal Bank of Scotland (RBS.L) has soared after announcing profits doubled in the first quarter of the year, helping to drag the FTSE 100 into positive territory as the market awaits US job figures this afternoon.

RBS jumped 29.4p, or 9.6%, to 335.6p as the taxpayer-owned bank reported pre-tax profits of £1.6 billion for the first three months of the year, almost double what it made in the same quarter last year. The FTSE 100 rose four points, or 0.1%, to 6,813.

'The first quarter interim management statement appears at first read to be way above consensus and our forecast, driven by substantially lower impairments, accompanied by an encouraging outlook statement,' said Mike Trippitt, analyst at Numis.

InterContinental Hotels (IHG.L) also posted big gains, adding 202p, or 10% to £22.25 as it proposed a special dividend and reported the most revenue per hotel room for nearly two years.

InterContinental is proposing returning $750 million (£440 million) to shareholders and reported a 6% jump in revenue per room for the first quarter.

Resolution (RSL.L) added 3.7p, or 1.2%, to 301.3p as the closed-book life insurer, whose shares have slumped in recent months, was raised to 'neutral' from 'underperform' by analysts at Credit Suisse. 

AstraZeneca (AZN.L) fell 36p, or 0.7%, to £47.79, after US rival Pfizer improved its takeover offer from £46.61 to £50 per share. Analysts at Barclays said the offer was likely to prove merely a step towards further negotiation.

'The 70%/30% equity/cash original offer left shareholders with a possibly unwelcome high exposure to Pfizer shares,' they said. 'Today's deal shows a more modest move towards increasing that cash component to around 32% and we expect this could be a point of negotiation going further.'

Trading was muted elsewhere, as investors waited for the publication of US non-farm payroll jobs data this afternoon. Investors expect hiring to have increased at the quickest rate in five months in April.

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