FTSE buoyed by furlough extension
The FTSE bounced as traders welcomed the Chancellor’s plans to extend the government’s furlough scheme.
London’s markets thus stood tall compared to their European counterparts, which continued to be dogged by fears that a second wave of coronavirus could halt plans to reopen the economy. The FTSE 100 closed 55.04 points higher at 5,994.77.
Connor Campbell, financial analyst at Spreadex, said: “There were a couple of major factors at play helping the UK index out. The extension of the government’s furlough scheme until the end of October was a clear boost, even if questions remain about companies sharing some of the cost from August onwards.”
Europe’s other key markets were broadly mixed but more muted as dealers wait for more evidence over whether infection rates might pick up again.
Meanwhile, sterling was weaker as traders believed that the Chancellor’s furlough plans could weigh on the UK’S national debt for an extended period.
The value of the pound fell 0.34 per cent versus the US dollar at $1.229 and was down 0.87 per cent against the euro at €1.131.
Multinational firms again helped to bolster the performance of the FTSE, with British American Tobacco and Diageo strengthening again.
In company news, Vodafone pushed towards the top of the UK’S leading index after the company maintained its dividend.
The telecoms operator said it bounced back from a multi-billion-euro loss to post a profit in its most recent financial year. Consequently, its shares ended the day 9.88p higher at 122.88p.
Elsewhere, Morrisons also closed in the green – up 6.35p to 195.1p – after it posted surging retail sales over a “volatile” first quarter. It saw a 5.7 per cent rise in group like-for-like sales in the 14 weeks to 10 May.
Online retailer AO World jumped after it said sales of bread-makers and chest freezers surged due to the coronavirus lockdown. It increased by 4.9p to 90.5p.
Recently-listed Inspecs, which designs and manufactures eyewear and glasses, saw a rise after reporting a jump in pre-tax profit in its first set of annual results since floating. Shares were up 5p to 170p.