London close: Stocks rise as euro leaders boost firewall

30th Mar 2012 16:32

- Eurozone to boost firewall to 800bn euros- Spain cuts 27bn euros from the budget- Petrofac up after broker comments, Shire leads the fallersLondon's blue chip index finished the day strongly after Eurozone leaders agreed to strengthen the firewall to protect the debt crisis from spreading. Some positive data Stateside also did its bit to help the mood.However, despite today's rise, the FTSE 100 is still down 1.4% on last Friday's close of 5,855. Compared with the closing price of 5,966 seen two weeks ago, the Footsie has fallen 3.3%.After a hot debate, the 17 finance ministers of the Eurozone, which form the so-called Eurogroup, have agreed to boost the region's firewall to €800bn. Austrian Finance Minister Maria Fekter announced that the amount represents the €500bn ESM, €200bn in EFSF funds already assigned to Ireland, Greece and Portugal, €53bn in bilateral loans and €49bn from the original EFSM. French Finance Minister François Baroin said that the group is now in a stronger position to tackle discussions on the IMF in April. "It's a good sign," he said. The borrowing rate of 10-year Spanish government debt dropped by as much as 11 basis points today after the country announced that it is slashing €27bn from the budget in 2012 by implementing measures such as a public sector pay freeze and higher taxes for large companies.In the US, the University of Michigan and Thomson Reuters index of consumer sentiment rose from 75.3 to 76.2 in March, the highest in 13 months. Meanwhile, consumer spending rose by a better-than-expected 0.8% month-on-month in February, outpacing income growth.In domestic news, Gfk's consumer confidence index for the UK dropped from -29 in February to -31 in March, expectations had been for a slight improvement to -28. SHIRE DROPS AFTER DRUG TRIAL FAILUREShire, the specialty biopharmaceutical group, dropped into the bottom spot on the FTSE 100 after one of its drugs missed the main target during a recent clinical trial. Its Lialda drug did not meet the primary endpoint in reducing the rate of recurrence of diverticulitis over a two-year treatment period as was hoped. Shares were down 4.5%.In contrast, drugs giant AstraZeneca was wanted after that a US District Court has ruled that the formulation patent protecting its SEROQUEL XR blockbuster drug is valid will be most welcome with shares up 0.5%.Oilfield services firm Petrofac gained 5% to top the list after Bank of America maintained its buy rating on the stock and labelled it as its sector pick. Engineering peers Weir and IMI were also in demand.Vodafone was softer following a budget proposal by India to back-date tax charges on overseas transactions involving local assets. The Indian government is still smarting from losing a four-year legal battle to sting Voda for $2.2bn in taxes relating to the UK telecoms giant's acquisition of Hutchison Whampoa's Indian mobile assets. Randgold Resources fell despite reaffirming its medium-term production target. The group said, alongside the publication of its annual report, that 2012 has "started with some real challenges".FTSE 250: ESSAR PROGRESSES TOWARDS NEW LOAN AGREEMENTEssar Energy was a big riser on the second-tier index after it said that its subsidiary Essar Oil has made significant progress with its lenders towards exiting the current loan agreement, which relates to the corporate debt restructuring scheme and its Vadinar oil refinery in Gujarat.QinetiQ was in demand after revealing that it is to get a one-off payment of £65m from the Ministry of Defence (MoD) after the two parties signed an agreement releasing the MoD from accumulated costs incurred in previous years. FTSE 100 - RisersPetrofac Ltd. (PFC) 1,740.00p +5.01%Weir Group (WEIR) 1,764.00p +3.89%Man Group (EMG) 134.80p +3.69%Evraz (EVR) 369.50p +3.33%ITV (ITV) 88.35p +3.15%Admiral Group (ADM) 1,187.00p +2.77%Antofagasta (ANTO) 1,152.00p +2.67%Johnson Matthey (JMAT) 2,359.00p +2.57%IMI (IMI) 972.50p +2.53%CRH (CRH) 1,280.00p +2.40%FTSE 100 - FallersShire Plc (SHP) 2,020.00p -4.63%Randgold Resources Ltd. (RRS) 5,370.00p -1.83%Vodafone Group (VOD) 172.20p -1.29%British American Tobacco (BATS) 3,150.50p -1.04%Diageo (DGE) 1,502.50p -0.86%Imperial Tobacco Group (IMT) 2,535.00p -0.86%RSA Insurance Group (RSA) 104.60p -0.76%Royal Bank of Scotland Group (RBS) 27.64p -0.68%Resolution Ltd. (RSL) 261.30p -0.65%G4S (GFS) 272.50p -0.58%FTSE 250 - RisersKentz Corporation Ltd. (KENZ) 490.00p +8.17%Jupiter Fund Management (JUP) 248.90p +7.80%Brewin Dolphin Holdings (BRW) 177.00p +7.08%Diploma (DPLM) 450.00p +6.99%QinetiQ Group (QQ.) 159.30p +6.41%Essar Energy (ESSR) 155.30p +5.79%Ruspetro (RPO) 216.00p +5.37%KCOM Group (KCOM) 73.50p +5.00%Afren (AFR) 133.40p +4.96%Micro Focus International (MCRO) 473.00p +4.85%FTSE 250 - FallersPetropavlovsk (POG) 557.00p -4.79%FirstGroup (FGP) 237.70p -3.92%Domino's Pizza UK & IRL (DOM) 431.60p -2.68%Kesa Electricals (KESA) 70.00p -2.64%Cape (CIU) 412.60p -2.57%Gem Diamonds Ltd. (DI) (GEMD) 273.50p -2.43%Carpetright (CPR) 685.50p -2.07%Ocado Group (OCDO) 114.50p -1.89%CSR (CSR) 229.90p -1.88%Lonmin (LMI) 1,022.00p -1.83%BC