Reuters: Hot Stocks: Britain's FTSE boosted by stimulus hopes and earnings

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Britain's FTSE boosted by stimulus hopes and earnings Apr 24th 2013, 08:37 Wed Apr 24, 2013 4:37am EDT * FTSE 100 up 0.3 percent * Stimulus hopes continue to underpin equity gains * Standard Life, Barclays rally after results By David Brett LONDON, April 24 (Reuters) - Britain's top share index edged higher on Wednesday following a big rise in the previous session as expectations that central banks will do more to boost growth continued to support equities. Earnings were in focus among financials, with Standard Life and Barclays both rising after results. By 0759 GMT, the FTSE 100 was up 19.10 points, or 0.3 percent at 6,425.22 points, after rising 2 percent on Tuesday - its biggest one-day climb since Jan. 2 - on hopes of further central bank stimulus. Loose monetary policy is buoying appetite for risk among investors and has been the major driver for stocks this year. "I can certainly understand the market reaction (to talk of a potential rate cut by the European Central Bank next week)," said Commerzbank economist Peter Dixon. "Central bankers take the view that if you can get a rally in market activity you can improve the balance sheets of the private sector, which will hopefully help to ensure some form of recovery ... "They just want to float the economy off the rocks and worry about the consequences (asset bubbles) later," he said. A survey showing German business sentiment fell in April for a second month and by even more than predicted, a sign that Europe's largest economy is struggling to recover, reinforced expectations the ECB will cut rates as soon as next month. Miners, which are heavily exposed to efforts to revive the global economy, topped the list of gainers on Wednesday but remain down almost 15 percent in 2013 on concerns over demand for raw materials as global growth fails to recover. Kazakh miner ENRC rallied 2.7 percent to 290 pence after the London-listed firm's chairman Mehmet Dalman resigned with immediate effect in a boardroom shake-up likely to raise new questions over its future. The firm is subject to bid speculation. UBS said that, should one emerge, a realistic offer that might be accepted by major shareholder Kazakhmys and ENRC's independent directors would be in a range between 375 pence and 540 pence per share. A buoyant start to the UK reporting season also continued to draw in investors. Standard Life rose 6.2 percent as it saw net flow of new money it administers more than double in the first quarter from a year earlier. "Auto enrolment (a law that means that every employer must automatically enrol workers into a workplace pension scheme) is boosting volumes more than the market anticipated, and the Canadian recovery also seems stronger than expectations. The outlook remains positive," Investec said in a note. British bank Barclays rallied 2.8 percent after it said it was confident it would cut annual costs by 1.7 billion pounds ($2.6 billion) under a restructuring plan unveiled by its new chief executive in February. "Barclays has a Herculean task in reinventing itself whilst at the same time continuing to grow the business," said Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers. "The shares are a long way from historic highs ... There is little doubt that the bank still has much to do, but in the meantime the market is showing faith in the story." Gains on the FTSE 100 would have been more were it not for companies going ex-dividend on Wednesday. They took 9.26 points off the index, according to Reuters calculations at current market prices and the effect of the resulting adjustment to prices by market-makers. (Editing by Catherine Evans) Link this Share this Digg this Email Reprints

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