Recovering financials lead FTSE up

By MoneyhighStreet Staff. Published on August 28, 2008 This post currently has no comments.

The City
London bluechip stocks finished up today, with investors'' buoyed by opening gains recorded in New York.

The benchmark FTSE 100 index rose by 62.75 points to finish up at 5,590.90.

Among the most marked gains were those recorded by financials with Barclays HBOS and Royal Bank of Scotland gaining on speculation that the worst of the ongoing credit crunch could be over.

French lender Credit Agricole''s announcement that its Tier 1 capital ratio was firm also instilled fresh confidence in lenders.

Commenting on the improved showing for the sector, Mark Bon of Canada Life, told the Bloomberg news agency: "A lot of people are considering going neutral on banks.

"I think a lot of the financial crisis is priced in. We know that we are going into an economic slowdown where the basic banking business will be difficult, but a lot of the bad news is quite well known and priced in shares."

The gains for financials offset falls for mining companies which were hit by weakening commodity prices.