Bank shares rise after Italy takes action

Market report Perry Gourley

UK financial services stocks helped push the Footsie higher after the Italian government pledged billions of euros to wind up two of the country’s failed banks.

The FTSE 100 Index closed up 22.67 points at 7,446.8 as investors cheered a move by Italian ministers to split Veneto Banca and Banca Popolare di Vicenza into “good” and “bad” banks.

Shares in Royal Bank of Scotland rose 4.2p to 249.8p, while Barclays climbed 2.4p to 199.9p and HSBC stepped up by 8.2p to 688.9p.

Strength returning to the oil price also provided some uplift to the London market. Brent crude was up 0.6 per cent at $45.79 a barrel, although had been higher during the session

Connor Campbell, Spreadex financial analyst, said: “Though Brent crude saw a rather sizeable reversal – it was up nearly 1.5 per cent and above $46 per barrel just after the bell, only to plunge more than half a per cent as investors lost their bottle – the FTSE held firm to its own 0.6 per cent growth.”

Shares in Edinburgh-based Cairn Energy edged up 0.2p at 170.1p after first oil flowed from the Kraken field in the North Sea in which it has a stake. Operator and majority owner of the field Enquest closed up 1p at 30.5p.

Shares in Edinburgh-based testing group Exova closed flat at 239.25p, before it announced that chief executive Ian El-mokadem and chief financial officer Philip Marshall will step down following the takeover by Element Materials Technology. Costa Coffee-owner Whitbread rose 86p to 4,045p after Morgan Stanley hiked its earnings per share forecast. Shares in the Glasgow-based travel firm were in demand after it said appeals against its proposed Crete development had been dismissed. Shares in the Dublin-based oil and gas explorer with interests in Ireland and Africa dropped after it saw its losses widen in its latest financial year.