THE FTSE 100 index held on to its New Year rally yesterday as retail cheer helped offset more bad news for the economy.
Christmas trading updates from Next and Debenhams eased nerves in the retail sector and helped the Footsie secure its sixth str
aight day of gains.
Oil prices surging through the $50 a barrel level at one stage also gave commodity stocks a boost, which contributed to the FTSE 100's 59.3 point advance to close at 4,638.9.
Blue chips were able to shake off further economic gloom, after the Nationwide said house prices fell by 15.9 per cent during 2008 in the biggest one-year drop on record.
Survey data also confirmed that firms in the services sector were shedding jobs at a record rate after further sharp falls in output and turnover.
Paul Webb, chief dealer at CMC Markets, said: "It's been another largely upbeat day for UK equities with the FTSE extending its winning streak.
"Miners have been providing much of the upside with rising copper prices being seen as lending support and although crude temporarily retook the $50 a barrel mark, the fact this has now eased has left the petrochemicals heavyweights to retreat somewhat too."
Next was up 12 per cent in the top flight, while FTSE 250 stock Debenhams surged 20 per cent as investors breathed a sigh of relief at the pair's sales figures over the all-important festive period.
Shares in Next jumped 136p to 1,227p after it held profit forecasts in line with previous guidance and reported a good start to New Year sales.
But Debenhams was the sector's star performer after the department store chain limited its like-for-like sales decline to 3.5 per cent and said profits rose in the 18 weeks to 3 January. Shares have been battered recently, but responded to yesterday's update with a gain of 5.75p to end at 34.25p.
Other retailers on the rise outside the Footsie included DSG International, which owns PC World and Curry's, which surged 17 per cent or 3p to end the day at 21p. Meanwhile, JJB Sports continued its recent recovery with a rise of 5.4p to close at 14p.
Back in the top flight, miners added to the blue chip advances, with Xstrata the biggest gainer in the sector, ahead 106.5p at 899.5p.
Fund manager Man Group was also a top performer after a series of positive broker notes, including one from Evolution, which lifted the stock by 17 per cent, or 42.5p, to close at 287p.
But banks were suffering in the wake of Monday's downbeat outlook from Deutsche Bank and the Financial Services Authority's decision not to extend the ban on short selling when it expires next Friday.
Lloyds TSB was the biggest loser, down 5 per cent, or 6.7p, to 119p, followed by HSBC, off 21.25p at 657.75p.
Shares in RBS dropped by 1.5p, or 2.9 per cent, to close at 51p, but HBOS ended the day at 68.9p, up 3.1p or 4.7 per cent.
The full article contains 540 words and appears in The Scotsman newspaper.
