STOCK markets rallied strongly yesterday as investors pinned their hopes on a fresh set of measures to help the ailing global economy.
Insurers helped drive the FTSE 100 index higher, up by 6.2 per cent, or 250.7 points, to 4,300.1.
The sec
tor gained strongly, having been badly hit recently by the slide in equity markets on valuations and concerns over the impact of a recession.
Prudential was the Footsie's biggest gainer, ahead 67.5p to 358.5p – a rise of more than 23 per cent.
It was followed close behind by Old Mutual, up 6.6p to 49.7p, Friends Provident, up 9.5p at 83p and Edinburgh-based Standard Life, which was up 8p or 3.9 per cent to 213p.
The markets were boosted by optimism over US president-elect Barack Obama's major spending plans announced at the weekend, a new Chinese stimulus package and a bailout for US car makers.
Richard Hunter, head of UK equities at Hargreaves Lansdown said: "(The package] is going to take some time to take effect and there are going to be a number of economic hurdles to overcome before we can get to a stage where we can say we leave the trouble behind."
He added: "I will treat it with some caution in terms of whether it is sustainable."
Banks were also benefiting in the rebound, with Barclays the top gainer in the sector with a 19.6p rise to 157.9p. HBOS ended the day 6.7 per cent or 5.8p up at 92.5p, while Royal Bank of Scotland finished 6.3p or 10 per cent up at 69.3p.
Miners littered the blue-chip risers' board, led by Eurasian Natural Resources, up 46.75p at 301p. Other double-digit gainers in the sector included Anglo American and BHP Billiton, which rose 193p to 1,429p and 152.5p to 1,128p respectively.
Oil also bounced back from the four-year lows reached last week to above $43 a barrel on rumours of an imminent production cut from oil cartel Opec. This lifted BG Group 72p to 859.5p, BP 30.5p to 508.5p and Royal Dutch Shell 117p to 1,632p, a rise of 8 per cent.
Premier Inn and Costa Coffee parent Whitbread, meanwhile saw shares rise 55.5p to 817.5p as it reported "robust" trading despite announcing plans to curtail its growth next year.
The strong gains for the wider market saw just three top-flight stocks in negative territory. The trio included property firm Liberty International, which was 10.75p lighter at 482.75p after it was cut to sell by brokers at Societe Generale.
In the second tier, Talk Talk firm Carphone Warehouse fell 4 per cent after its co-founder David Ross quit following his failure to declare use of his shares as backing against personal loans.
Ross owns almost a fifth of the company. His departure comes soon after Carphone warned that next year would be the most challenging economic climate ever faced by the firm, causing caused shares to drop 4p to 89p.
The full article contains 537 words and appears in The Scotsman newspaper.
