By Benjamin Chiou
Date: Tuesday 01 May 2012
Massive gains for Lloyds following the lender’s first-quarter results meant that the banking sector was the best performing sector on Tuesday afternoon.
Profits at Lloyds Banking Group were back in the black in the first three months of 2012, prompting a near-7% jump in the share price before the close of trade. The bank said pre-tax profits came in at £288m compared to a loss of £3.47bn in the same period the year before.
"Although our results reflected the subdued UK economic environment, the actions we have taken to further reduce costs, strengthen the balance sheet and reduce risk, and the additional investment we have made in our core franchise, are mitigating these effects and will position us well for future growth," said chief executive António Horta-Osório.
Meanwhile, Investec reiterated its buy recommendation for the stock today and saying: “If Antonio still needs cheering up after the 6% share price rebound of the past eight days then the underlying trends visible in today's numbers could be just the tonic," the broker said.
“Barclays delivered a large beat last week and was well rewarded. Lloyds has broadly met expectations today, and tomorrow's 05:00 Q1 IMS from Standard Chartered will, we believe, be a pleasure to read!”
Both Barclays and Standard Chartered were performing well on Tuesday afternoon, while Royal Bank of Scotland (which reports on Friday) was also making strong gains.
Also boosting sentiment today was some better-than-expected manufacturing data from the US, which fuelled buying late on in London. The Institute for Supply Management (ISM) Purchasing Managers’ Index improved from 53.4% in March to 54.8% in April. The market consensus was expecting a slight fall to around the 53%-mark.
Top performing sectors so far today
Banks 3,874.24 +2.04%
Tobacco 37,004.82 +2.02%
Fixed Line Telecommunications 2,468.00 +1.99%
Mining 20,925.30 +1.77%
Aerospace and Defence 3,756.06 +1.75%
Bottom performing sectors so far today
Industrial Transportation 2,362.93 -1.16%
Technology Hardware & Equipment 736.04 -1.16%
General Retailers 1,730.19 -0.05%
Aeronautics and Defence NULL 0.00%
Alternative Energy 8,888.00 0.00%
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