London close: Stocks rise on Greek deal and QE

9th Feb 2012 16:37

- Greek deal agreed, says PM's office.- BoE boosts QE by £50bn.- ECB keeps rates on hold.Stocks were given a boost in afternoon trade on news that Greek leaders had come to an agreement over an austerity package. However, gains were trimmed late on as investors began to assess the very limited details that have come out of Athens. Meanwhile, the Bank of England's Monetary Policy Committee (MPC) took the market's attention away from Greece for a brief moment at midday, as it decided to boost its quantitative easing programme by £50bn to £325bn, as expected. The MPC also left its lending rate unchanged at 0.5%. Shortly after, the European Central Bank decided to keep its key lending rate unchanged for another month, in line with what most analysts have been expecting. According to a statement from Greek Prime Minister Lucas Papademos's office, "the government's discussions with the troika were concluded successfully this morning on the issue which had remained open for further elaboration. The political leaders have agreed on the result of these discussions." "Thus there is general agreement on the content of the new programme, in view also of this evening's Eurogroup meeting. This programme accompanies the new loan agreement to finance Greece with €130bn," the statement said.Party leaders initially expressed differences over pension reform which last night left a €300m shortfall in its deficit reduction plan. When asked how the parties' disagreements over pensions had been resolved, a government official told Reuters that they would make cuts in other areas of public spending to minimise the reductions in pensions.In other news, US unemployment claims declined by 15,000 to 358,000 last week, compared with consensus estimates of 370,000.OIL STOCKS TRACKS CRUDE HIGHEROil prices were given a lift today by the positive developments in Greece as well as the bigger-than-expected drop in US jobless claims. Brent crude was 0.7% higher at $118.03 in afternoon trade on the IntercontinentalExchange. As such, oil services and oil-producing stocks were in demand, with Amec, Petrofac, Tullow Oil and Cairn Energy performing well late on.BG Group was among the risers after higher oil prices helped earnings before tax shoot up by 40% on last year in the fourth quarter. The group also gave a confident outlook for the LNG market, hiking its LNG profit guidance by 30% for 2012. .SABMiller was also higher after the brewing company announced it would invest $80m in a new brewery for its Ugandan subsidiary, Nile Breweries. Sweeteners manufacturer Tate & Lyle fell after reporting a mixed performance in the third quarter with subdued volume growth in several divisions. The firm, nevertheless, said its remains on track for a "good performance" in the full-year. Property group British Land saw shares drop despite seeing occupancy, income, estimated rental value and underlying profits rise in the third quarter. Rolls-Royce was out of favour despite 2011 being a record-breaking year on many fronts. The power systems developer saw underlying profit before tax rose 21%, while underlying revenue edged up 4%. Mining giant Rio Tinto slipped after saying that full-year net earnings were held back by a massive $8.9bn impairment charge relating to its aluminium business. Nevertheless, underlying earnings rose 11% to a record $15.5bn. After falling early on, drinks giant Diageo finished in the blue after reporting that strong sales growth in emerging markets helped offset slower growth elsewhere in the first half. SVG AND CATLIN RISE ON THE FTSE 250 SVG Capital, the private equity investor which owns Hugo Boss and Birds Eye frozen food firm iglo, jumped 8% after seeing a 10.9% rise in its net asset value (NAV). The movement has been driven by a significant increase in the valuation of Hugo Boss, which rose £96.1m between 2010 and 2011 on the back of improved earnings. Iglo jumped £18.1m. Meanwhile, Bermuda-based insurance underwriter Catlin was performing well after gross premiums written climbed to $4.51bn from $4.07bn the year before, while net premiums written advanced to $3.84bn from $3.32bn. Meanwhile, net income before tax slumped to $71m in 2011 from $406m the year before. BCFTSE 100 - RisersAmec (AMEC) 1,110.00p +3.64%BG Group (BG.) 1,491.50p +3.15%Petrofac Ltd. (PFC) 1,517.00p +3.13%Schroders (SDR) 1,650.00p +2.48%Admiral Group (ADM) 985.00p +2.13%Schroders (Non-Voting) (SDRC) 1,309.00p +2.11%Tullow Oil (TLW) 1,514.00p +2.09%Glencore International (GLEN) 442.95p +1.96%Wolseley (WOS) 2,271.00p +1.79%Smiths Group (SMIN) 1,032.00p +1.67%FTSE 100 - FallersTate & Lyle (TATE) 672.50p -3.24%Evraz (EVR) 428.80p -2.99%British Land Co (BLND) 497.00p -2.17%ICAP (IAP) 381.40p -1.95%Rolls-Royce Holdings (RR.) 770.00p -1.91%International Consolidated Airlines Group SA (IAG) 180.20p -1.53%Rio Tinto (RIO) 3,815.00p -1.51%Tesco (TSCO) 324.50p -1.49%International Power (IPR) 328.20p -1.44%National Grid (NG.) 640.00p -1.08%FTSE 250 - RisersSVG Capital (SVI) 257.90p +8.36%Oxford Instruments (OXIG) 1,100.00p +7.53%Kesa Electricals (KESA) 85.05p +5.85%Catlin Group Ltd. (CGL) 449.00p +5.30%Smith (DS) (SMDS) 174.50p +5.25%Domino Printing Sciences (DNO) 629.00p +3.45%Unite Group (UTG) 193.40p +3.42%Ashtead Group (AHT) 245.00p +3.33%Inmarsat (ISAT) 470.10p +3.27%Lamprell (LAM) 331.20p +3.15%FTSE 250 - FallersSupergroup (SGP) 559.50p -3.45%Aquarius Platinum Ltd. (AQP) 157.00p -3.38%Rank Group (RNK) 139.00p -2.80%Allied Gold Mining (ALD) 135.90p -2.58%Misys (MSY) 292.30p -2.08%Ferrexpo (FXPO) 353.70p -2.02%Shanks Group (SKS) 104.00p -1.98%Carpetright (CPR) 567.00p -1.82%Hunting (HTG) 814.50p -1.81%Phoenix Group Holdings (DI) (PHNX) 569.50p -1.64%