Talk of fresh stimulus measures from central banks helped lift markets yesterday, with banks among the biggest beneficiaries amid hopes the European Central Bank (ECB) will resume bond buying on Thursday.
The FTSE 100 index gained 66.4 points, or almost 1.2 per cent, to 5,693.6 as the market awaited signs of further quantitative easing from the US Federal Reserve tomorrow and the outcome of Thursday’s monetary policy committee meeting at the Bank of England. Germany’s Dax index and the Cac 40 in Paris both enjoyed gains of around 1.2 per cent, while the Ibex 35 in Madrid closed almost 3 per cent higher.
Michael Hewson, senior market analyst at CMC Markets, said: “Markets have continued where they left off last week on expectations of an ECB magic trick later this week.”
Despite warning that it may face fines of at least $700 million (£446m) over its money laundering failings in the US, HSBC gained 12p, or 2.3 per cent, to 543.1p as it reported a better-than-expected 3 per cent dip in first-half underlying profits to $10.6 billion.
Royal Bank of Scotland gained 3.6 per cent to 222.2p, while Lloyds Banking Group added 2.9 per cent to 31.09p, and Barclays ended the day 2.1 per cent higher at 170.55p.
Expectations that European policymakers will do “whatever it takes” to resolve the region’s debt crisis lifted International Airlines Group, which owns Spain’s Iberia as well as British Airways. Its shares jumped 7.2 per cent, or 10.9p, to 162p ahead of half-year results on Friday.
NEW YORK: Stocks were flat as investors paused following the best two-day run this year, with central bank meetings and a full load of US economic data looming.
The Dow Jones Industrial Average dipped by 2.65 points, or 0.02 per cent, to close the day 13,073.01 points.