By This Is Money
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16:00: The blue chip index is 117 points higher, or 2.1 per cent, at 5610.
U.S. stocks also soared at the open after euro zone leaders agreed at a summit in Brussels that struggling banks could have direct access to the EU's bailout fund without adding to Government debt.
The Dow Jones was up 188.68 points, or 1.50 percent, at 12,790.94 despite figures showing that U.S. consumer spending failed to rise between April and May.
Markets in France and Germany were up more than 3 per cent.
In focus: Banks' shares jumped in morning trading after falling 2.4 per cent in the previous session
13:45: The FTSE 100 continues to edge up, and is now up 98.80 points, or 1.80 per cent, to 5591.
12:00: The Footsie is now up 73 points, or 1.33 per cent, at 5,566.
9:00:The FTSE 100 is trading 78 points higher, or 1.42 per cent, at 5,571.06 after jumping to a one-week high in early trade as an unexpected raft of measures to tackle the euro zone crisis lifted risk appetite and bolstered banks. The Footsie opened higher at 5493.06.
Risk appetite across markets has been lifted overnight by signs that an EU summit - for which investor expectations were very low - has actually come up with some measures to tackle the euro zone crisis.
Banking shares will be in focus today after falling 2.4 per cent in the previous session, dragged down by a 15.5 per cent slump in Barclays following investigations that found it tried to manipulate key market interest rates.
Among the biggest risers this morning are Barclays (up 3.85p at 171.98p), Lloyds Banking group (up 3.77p at 31.07p) and Royal Bank of Scotland (4.12p at 214.90p).
Euro zone leaders agreed to take emergency action to bring down Italy and Spain’s spiraling borrowing costs and to create a single supervisory body for euro zone banks by the end of this year, a first step towards a banking union.
After hours of argument, they also agreed that the bloc’s future permanent bailout fund, the European Stability Mechanism, would be able to lend directly to recapitalise banks without increasing a country’s budget deficit and without preferential seniority status.
Given the very low expectations ahead of the summit, positioning leaves markets vulnerable to a sharp upward correction, but strategists cautioned that previous relief rallies have proved short lived and that many details remain to be explained on the unveiled measures.
Although the euro zone developments will offer some support to financial shares, trouble for the sector is set to continue.
Britain’s financial regulator said today it had reached agreement with Barclays, HSBC, Lloyds and RBS in relation to the mis-selling of interest rate hedging products, exposing a second scandal in as many days.
Lloyds issued a separate statement saying it did not expect the financial impact from the settlement to be material.
The UK blue chip index closed down 0.6 per cent, or 30.86 points, at 5,493.06 yesterday.
Oil and copper prices rose on the news, potentially offering support to Britain’s heavyweight energy and mining companies.
A relatively bare corporate calendar in the UK is unlikely to detract investors from the EU summit and the bank scandal.
The market will, however, pay some attention to a raft of euro zone data including flash inflation for June, and to U.S. personal incomes and consumption data as investors seek to determine the chances of rate cuts or more quantitative easing from the central banks.
RBS is set to be fined about £150million pounds for offences of market manipulation similar to those that inflicted huge damage on Barclays, the Times reports.
CAIRN ENERGY is selling around a 3.5 per cent stake in its former unit Cairn India, and expects to receive about $360million.
AMEC has acquired Serco’s nuclear Technical Services business for a cash consideration of 137 million pounds.
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now that spains banks and italys are being bailed out with europes money what assets will they be made to sell as a condition for the bailout or will lloyds,rbs be able to renegotiate selling theirs,or are we being treated differently again ANSWERS ON A POSTCARD PLEASE.
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Article says......Banking shares will be in focus today after falling 2.4 per cent in the previous session, dragged down by a 15.5 per cent slump in Barclays following investigations that found it tried to manipulate key market interest rates. They didnt just try to manipulate rates, they did it and kept on doing it.........
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The euro is dead.......Long live the eurodollarpound or amero or whatever other stupid idea the owners of the central banks of the world come up with.
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Despite the deal the financial basics remain the same; the Euro is a failed experiment and Europe’s countries (excluding Germany) are uncompetitive. Expect more emergency summits!
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