FTSE moves sharply higher as investor confidence grows

END-OF-DAY REPORT: Headline shares ended sharply higher, with BP up on good Macondo well news, household goods manufacturers gaining benefit from their safety status, and Carnival cruising to the top of the leaderboard.

At the close of business, the FTSE100 was up 94.09 points at 5,602.54 with the FTSE250 ahead 107.21 points at 10,548.19 and the FTSE Smallcaps 38.4 points better at 2,925.44.

The main market in London put in a strong performance, helped by an element of bargain hunting and news that ratings agency Moody’s has praised the Coalition Government’s austerity measures and said the outlook for the UK’s public finances remains stable.

The Macondo well capping news gave BP a leg up, the shares jumping 8.3p at 411.35p. The general sigh of relief around the industry helped Shell to a gain of 41p at 1,852p, while BG Group added 31.5p at 1,114p. Meanwhile, crude rose to almost $75 a barrel.

The miners also enjoyed a positive session as metals prices firmed on demand hopes, with Xstrata one of the best of the bunch, up 24p at 1,191p. Rio Tinto gained 46.5p at 3,604p and Anglo American improved 31p at 2,546.5p.

As gold hovered around yet another record high and silver rose firmly, Randgold Resources gained 95p at 6,435p and Fresnillo climbed 13p at 1,181p.

The commercial property firms were in demand, with Hammerson topping the sector with a gain of 12.5p at 395.3p on news of a potential sale and Segro adding 5.5p at 269.3p on being upped to buy from reduce at Oriel.

In the financial world, banks made modest moves forward, as investors await the outcome of the breakup inquiry, with Barclays the best of them, up 8.7p at 313.35p. Asia-facing Standard Chartered bucked the trend, falling 2p at 1,898p on litigation concerns.

Defence contractor BAE Systems climbed 4.6p at 333.8p as it announced a move to acquire the consultancy division of US group L-1 Identity Solutions to beef up its counter terrorism offerings. BAE will pay $296m in the deal.