FTSE gains ground to start the week

The FTSE 100 closed up 1.47 per cent to 5611.20 as traders hope the tide of last week's forlorn performance is changing.

Honours of the day went to defence specialist Cobham – rising 6.12 per cent.

Vodafone was up 5.26 per cent, John Wood rose 5.16 per cent, and BG Group rose 4.48 per cent, while International Power was up 3.97 per cent.

ITV continued its downward fall – slipping 5.68 per cent – while Friends Provident slid 3.58 per cent.

Wolseley was down 2.9 per cent, Lonmin dropped 2.46 per cent and London Stock Exchange Group fell 2.23 per cent.

Outside the FTSE 100, Southern Cross Healthcare fell 58.39 per cent on news it would miss targets as local authority funding stalled from central government and Trinity Mirror fell 29.37 per cent.

“The FTSE 100 seems intent on giving up almost all of its 17.7 per cent gains made since the year's lowest levels in March, having shed almost 14 per cent on the year so far thanks to ongoing concerns over the ailing credit markets and rising oil prices,” said Anthony Grech, market analyst at IG Index.

“And despite investors having taken cheer from some rare, positive news today, pushing the FTSE back through the psychological 5600 mark after last week's losses, there certainly seem no guarantees that the mid-March lows will not be tested again in the coming weeks.”

He added: “The horizon still seems gloomy for the UK economy, with news that consumer confidence this month slumped to its lowest levels since March 1990, adding more interest to Thursday's Bank of England rate announcement.

“All eyes are on the MPC, and any potential rate rise, to see whether today's gains will be part of a sustained comeback from buyers or will there simply be too much weighing on the UK markets, making any positive sentiment short-lived.”