Thursday’s was a broadly positive session for London shares, as valuations rebounded after three consecutive days of trading in the red.
The FTSE 100 index added 0.9% on Thursday, rising 53 points to 5,830, while the FTSE 250 index took on 0.6% or 70 points to settle at 11,898.
The rally was triggered by upbeat news from the US, where a drop in initial jobless claims to the lowest level in well over four years offered encouraging signs as to the health of the global economy.
Closer to home, Burberry (BRBY) was the standout performer on the UK blue-chip index, surging 13.2% after the luxury goods brand managed to avoid fulfilling its recent profit warning. Burberry reported slowing sales growth in the first half but the numbers announced on Thursday weren’t as bad as it had initially indicated. Shares had plummeted on the previous profit warning, hence Thursday’s mildly positive news offered an opportunity for bargain-hunters to move in.
‘Risk assets’ were also in demand, with banks Barclays (BARC) and Royal Bank of Scotland (RBS) climbing 4.8% and 4.2%, respectively, while miners Eurasian Natural Resources (ENRC), Vedanta Resources (VED) and Kazakhmys (KAZ) rose 3.2%-3.4% each.
Elsewhere, media reports that Centrica’s (CNA) British Gas will be raising fuel prices from as soon as tomorrow was of little concern to shareholders, who saw the stock edge up 0.8%.
On the downside, just one-tenth of the FTSE constituents failed to lock in gains on Thursday, with Morrison Supermarkets (MRW) the worst performer. Shares slipped 1.6% after the retailer said it bought back 1.8 million shares for cancellation at an average price of just over 270p apiece. The bulk of the remaining underperformers were stocks with defensive characteristics, underlining the return of investors’ appetite for risk.
