Barclays has sparked gains across the banking sector, kicking off the reporting season with news of a bigger-than-expected profits haul of £6.1 billion.
The group has leapt to the top of the FTSE 100 Index with a shares rise of 3% after reporting the 32% improvement in headline profits and revealing revenues up by a fifth at its investment banking division Barclays Capital in the final three months of 2010.
The wider Footsie was struggling to make headway, down 1.5 points to 6058.6, amid investor caution after the latest UK inflation figures revealed another surge last month, to 4% from 3.7% in December.
But this strengthened the pound as it heaped yet more pressure on the Bank of England to consider raising interest rates to calm inflation. Sterling rose to 1.61 dollars and 1.19 euros.
Barclays shares were up 10.5p to 321.3p and it gave a boost to others in the sector ahead of their full-year figures. Lloyds Banking Group added 1.5p to 67.2p and fellow taxpayer-backed Royal Bank of Scotland lifted 0.4p to 44.7p. Asian-focused Standard Chartered also rose, up 1p to 1695p, although HSBC slipped 2.3p to 705.6p.
Supermarket Morrisons was 1.8p dearer at 276.8p after unveiling the first major step in its e-commerce strategy with the acquisition of online retailer Kiddicare.
However, miners weighed on the top tier as copper prices fell. Antofagasta was the biggest faller, down 56p to 1430p.
In a busy morning for corporate results, Premier Foods added 1.9p to 24p in the FTSE 250 after the Hovis and Mr Kipling owner said it had reduced its debt burden to below £1 billion. Trading profits edged up to £311 million after a resilient 2010, according to chief executive Robert Schofield.
There was no such post-results boom for pizza delivery firm Domino’s, which gave back recent gains after revealing a sharp slowdown in sales growth since the start of its new financial year. This took the shine off news of a 27% rise in underlying full-year profits to £38 million, slightly ahead of market expectations. The company also signalled further progress in its online strategy and a ramped up store opening programme, but shares were off 35.2p to 487.8p.
Fellow second-tier stock Wood Group was also in the red as it gave back some of the gains seen yesterday after the oil and services support firm announced it had sold its well support arm to General Electric for 2.8 billion US dollars (£1.75 billion). Its shares were down 20p to 632p.
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