London close: FTSE 100 jumps two per cent on stimulus hopes

23rd Apr 2013 16:59

Markets on the whole shrugged off disappointing data from the Chinese manufacturing sector on Tuesday, as decent corporate earnings and stimulus hopes in Europe pushed the FTSE 100 two per cent higher.The Markit Eurozone composite purchasing managers' index (PMI) released this morning was unchanged at 46.5 in April. While the figure was in line with expectations, the sub-50 reading indicated a drop in activity in the region for the 19th time in the past 20 months. Figures from powerhouse Germany specifically were weaker than expected.Stocks reacted positively to the worse-than-expected data after it sparked speculation that it could open the door to further stimulus measures from the European Central Bank given the recent cooling of inflationary pressures.Alex Young, Senior Sales Trader at CMC Markets, said that the consensus view is that "data of this nature makes an imminent European rate cut more likely".He said: "This perverse 'bad data is good' rationale has been a feature of US markets for some time now as investors rely on the back stop of quantitative easing, but for bears unable to reconcile a bleak macro picture with perpetual equity market enthusiasm, these are frustrating times indeed."Miners in London were under pressure this morning after a disappointing reading of Chinese manufacturing. The HSBC manufacturing PMI fell from 51.6 to 50.5 in April, worse than the fall to 51.5 expected. This follows last week's revelation of surprise slowdown in China in the first quarter, as economic growth fell to 7.7% in the first three months, worse forecasts for an acceleration to 8.0%.FTSE 100: ARM surges after strong Q1 beatChip designer ARM Holdings jumped closed to its all-time high today after stronger-than-expected first-quarter figures, which showed a 26% increase in revenue and a 44% surge in profit before tax, both of which were well ahead of analysts' forecasts. Associated British Foods jumped after reporting a 10% rise in half-year revenue driven by sales at its clothing retail subsidiary Primark. Airline group IAG was among the best performers after saying that it has order 18 new Airbus A350 aircraft for British Airways. The company also announced that it has increased its stake in Spanish low-cost carrier Vueling.Power solutions giant Rolls-Royce was also in demand after reaching an agreement to sell its 50% stake in the RTM322 helicopter engine programme to Turbomeca for €293m.SABMiller was making gains despite saying that it has had to accelerate the promotion of its Chief Operating Officer Alan Clark to Chief Executive Officer after its Executive Chairman fell ill.Heading the other way were the miners as metals prices declined on the back of the poor Chinese data. Fresnillo, Randgold, Antofagasta and Anglo American were among the heaviest fallers. Tullow Oil was also in the red as it revealed that it had plugged and abandoned a well offshore French Guiana after it failed to encounter any hydrocarbons. This was the latest in a string of disappointing operational updates from the FTSE 100-listed oil explorer.FTSE 250: AVEVA gains on upbeat guidanceEngineering data and IT group AVEVA Group was a high riser after saying that it expects to hit revenue and profit forecasts for the full year following good demand in its second half. Sanlam Securities released a research report this morning saying that the in-line trading update prompted it to move its rating from 'sell' to 'hold'. Following a sharp fall in the share price of instrumentation and controls company Spectris on Friday after its first-quarter trading update, the stock was given a boost this afternoon by Investec which upgraded the stock from 'hold' to 'buy'. Premier Oil was also firmly higher after discovering oil at the Bonneville exploration well and its side track on the Catcher licence in the UK Central North Sea.FTSE 100 - RisersARM Holdings (ARM) 972.00p +11.85%Associated British Foods (ABF) 1,999.00p +8.05%Prudential (PRU) 1,096.00p +6.20%CRH (CRH) 1,387.00p +5.48%International Consolidated Airlines Group SA (CDI) (IAG) 269.60p +5.15%Melrose Industries (MRO) 247.80p +4.73%Aberdeen Asset Management (ADN) 416.00p +4.47%TUI Travel (TT.) 318.30p +4.43%IMI (IMI) 1,215.00p +4.38%Wolseley (WOS) 3,214.00p +4.15%FTSE 100 - FallersFresnillo (FRES) 1,092.00p -2.15%Antofagasta (ANTO) 884.00p -0.95%Tullow Oil (TLW) 1,037.00p -0.86%Randgold Resources Ltd. (RRS) 4,831.00p -0.80%Eurasian Natural Resources Corp. (ENRC) 282.30p -0.63%FTSE 250 - RisersSpectris (SXS) 2,007.00p +6.76%Electrocomponents (ECM) 241.10p +5.38%Synthomer (SYNT) 187.40p +4.75%Aveva Group (AVV) 2,159.00p +4.65%Savills (SVS) 534.50p +4.60%Fenner (FENR) 355.00p +4.41%Ferrexpo (FXPO) 168.90p +4.26%Premier Oil (PMO) 365.80p +4.19%William Hill (WMH) 426.70p +4.02%Bodycote (BOY) 482.40p +3.85%FTSE 250 - FallersAfrican Barrick Gold (ABG) 181.20p -3.87%Kazakhmys (KAZ) 340.30p -3.76%New World Resources A Shares (NWR) 154.70p -3.31%AZ Electronic Materials SA (DI) (AZEM) 283.20p -2.34%PayPoint (PAY) 865.00p -2.26%Centamin (DI) (CEY) 37.56p -2.21%BH Global Ltd. USD Shares (BHGU) 11.75 -2.08%KCOM Group (KCOM) 82.00p -1.50%NMC Health (NMC) 336.00p -1.18%Electra Private Equity (ELTA) 2,199.00p -1.12%BC