Footsie ends flat as bounce in economy offsets weak earnings at Barclays

FTSE:6,068.15 (–1.20) Mid-250:11,895.02 (+25.58) Small Cap:3,281.24 (+9.62)

MOST UK stocks climbed yesterday, keeping the benchmark FTSE 100 Index near a two-month high, after a rebound in the British economy in the first quarter outweighed earnings at Barclays that disappointed investors.

The FTSE 100 closed little changed at 6,068.15 in London as two stocks rose for each one that fell.

Tesco and ARM traded without the right to their latest dividends, pulling the measure lower. The FTSE All-Share Index was also almost unchanged.

“The only game in town that was ever likely to get people excited today was publication of the initial first-quarter UK gross domestic product numbers,” said Howard Wheeldon, a senior strategist at BGC Partners in London. The “numbers at least place us back at square one on the so-called recovery jigsaw board”, he said.

UK’s GDP rose 0.5 per cent from the final quarter of 2010 when it fell by the same amount, according to the Office for National Statistics in London, amid the strongest surge in service industry growth for four years.

GlaxoSmithKline rose 2.1 per cent to 1,286.5p. The UK’s biggest drugmaker reported a 14 per cent increase in first-quarter profit to £1.53 billion ($2.5 billion), lifted by a gain from the sale of its stake in Quest Diagnostics.

Aggreko jumped 4.4 per cent to 1,786p after the world’s largest provider of mobile power supplies said trading profit in 2011 will be ahead of 2010.

Barclays limited gains in the FTSE 100, falling 4.8 per cent to 287.5p. Pretax profit at its investment banking unit dropped 33 per cent in the first quarter to £982 million as revenue declined 15 per cent.

Reckitt Benckiser gained 1.9 per cent to 3,324p after analysts at Sanford C Bernstein said Unilever may pursue the maker of Lysol cleaners.

Bodycote, a supplier of metal-strengthening services to Ford Motors, surged 13 per cent to 380p after the company forecast full-year operating profit toward the top end of analysts’ forecast range.

Associated British Foods sank 5.8 per cent to 984p, the worst performance in the FTSE 100.

ITV dropped 3.9 per cent to 72.75p after rival British Sky Broadcasting reached a new agreement to broadcast most of the UEFA Champions League soccer matches until summer 2015. – (Bloomberg)