London close: Late rally pulls FTSE 100 into blue

8th Sep 2011 16:32

It was a volatile day for the Footsie on Thursday, as a steady decline after the Bank of England (BoE) rate decision was met with a late afternoon comeback. The Footsie managed to pull above water by 16:30 to finish with a gain of 0.41%.The BoE announced at midday that it had kept interest rates unchanged at 0.5%, while holding fire on its £200bn quantitative easing (QE) programme. UK gilts advanced after the BoE left monetary policy unaltered, resisting calls for further loosening through an extension of QE. The yield on a 10-year gilt fell by three basis points to 2.31%. "Although the case for more stimulus has certainly strengthened, the deterioration in the demand outlook was evidently deemed insufficient to warrant an immediate move," analysts at Barclays said. "However, a further slide in the activity and confidence data over the next couple of months would make QE a real prospect come the November Inflation Report." Helping the afternoon claw-back was a better-than-expected US trade balance, which fell by 13.1% in July to $44.8bn, according to the latest data from the Commerce Department. Consensus was expecting the deficit to fall to just $51bn.In company movements, Glencore, the commodities trader, was the highest riser on Thursday after First Reserve International sold $800m of Glencore convertible bonds and invested in 141m ordinary shares in the firm, which Liberum Capital thinks is equal to 2% of the shares in issue.Gold and silver prices, which were both over 2% higher by the close, bolstered gains for mining giants Fresnillo and Randgold Resources.Tullow Oil was being boosted by bid chatter again, rising near 5%, on rumours that China National Offshore Oil Corporation (CNOOC) is eyeing up the Africa-focused oil titan.FTSE 250 oil explorers Afren and Heritage Oil were in demand after an RBS report suggested that Wednesday's merger between Vallares and Genel as a net positive for the UK exploration and production (E&P) companies already present in Kurdistan.The retailers were in demand, defying a generally gloomy outlook for the UK consumer, after some pleasing results from giants Morrison and Home Retail Group. Supermarket chain Morrison's focus on value - and longer opening hours - helped it post sales and profits ahead of expectations in the half year to 31 July, while Home Retail saw the like-for-like sales decline in its Argos division slowdown in the second quarter.Leading the fallers was car insurer Admiral after the Office of Fair Trading said it was going to investigate the car insurance sector.Fund manager Schroders' share price took a knock after Deutche Bank downgraded it from buy to sell.Premier Farnell, the electronic components supplier, was the heaviest faller on the FTSE 250 after underlying revenues eased in the three months to July.In other economic news, the European Central Bank maintained its key policy rate steady at 1.5%, as expected - driving down the yield on a 10-year German bund by five basis points to 1.86%.BCFTSE 100 - RisersGlencore International (GLEN) 436.50p +7.58%Tullow Oil (TLW) 1,227.00p +4.78%ARM Holdings (ARM) 590.00p +4.52%Vedanta Resources (VED) 1,451.00p +4.39%Fresnillo (FRES) 2,147.00p +4.38%Morrison (Wm) Supermarkets (MRW) 301.60p +4.22%Man Group (EMG) 229.10p +3.95%Randgold Resources Ltd. (RRS) 7,040.00p +3.83%Hargreaves Lansdown (HL.) 503.50p +3.56%Marks & Spencer Group (MKS) 321.90p +2.58%FTSE 100 - FallersAdmiral Group (ADM) 1,364.00p -2.36%Schroders (SDR) 1,446.00p -2.10%Unilever (ULVR) 2,011.00p -1.85%Lonmin (LMI) 1,240.00p -1.59%Schroders (Non-Voting) (SDRC) 1,150.00p -1.46%Johnson Matthey (JMAT) 1,603.00p -1.29%GKN (GKN) 188.20p -0.95%British Sky Broadcasting Group (BSY) 669.00p -0.89%Severn Trent (SVT) 1,460.00p -0.88%Land Securities Group (LAND) 735.00p -0.81%