By Roger Baird, Press Association City Staff
The London market lifted as traders were cheered by a cut in China's interest rate and hopes that the eurozone will extend its huge stimulus programme.
China cut its key interest rate for the sixth time this year, falling by 0.25% to 4.35%, in the hope this will spur growth as the country tries to reduce its reliance on construction and heavy industry.
The news sent the FTSE 100 Index 67.8 points higher to 6444.1, as investors hope the move bolsters weakening global trade.
European Central Bank (ECB) president Mario Draghi said yesterday it will consider increasing its monetary stimulus at its next meeting in December from its current 1.1 trillion euro (£805 billion) level. Cheap cash tends to favour investors.
Germany's DAX was up by almost 3%, and France's Cac was ahead by 2.5%. In New York the Dow Jones Industrial Average lifted more than 120 points in early trading.
CMC Markets analyst Jasper Lawler said: "The ECB had put markets in a cheery mood anyway but when China cut interest rates, the cheer turned into more of a holler."
The pound rose a cent against the euro to 1.39, as traders continued to react to Mr Mario Draghi comments yesterday. Sterling was slightly down against the US dollar to just over 1.53.
Wickes DIY chain parent Travis Perkins was the strongest riser in the top flight jumping 94p to 1939p, following a fall of 6% in the previous session after warning its annual earnings growth will be at the lower end of forecasts after slower sales in July and August.
Trustnet Direct market analyst Tony Cross said: "Travis Perkins is finding support after yesterday's sell-off with bargain hunters finding appeal in the fact that the summer slowdown should really have been expected."
However, education specialist Pearson was the biggest faller in the top flight, down 5%, or 49.5p to 900.5p, with investors still concerned over its profits warning earlier in the week.
The business said on Wednesday that earnings per share would be lower than previously expected following the sale of the Financial Times newspaper group and The Economist, as well as a currency hit. Its stock has fallen by 24% since Tuesday's close.
Outside the top flight, Telecoms operator TalkTalk saw its shares fall by more than 4%, or 11.7p to 256.8p, after it revealed millions of its customers could have been accessed by hackers after a "significant and sustained cyber attack" on its website.
Chief executive Dido Harding could not say whether the information had been encrypted as she apologised to customers who are now at risk of having their credit card and bank details used by the criminals behind the attack.
Still in the FTSE 250, William Hill fell by almost 8%, or 27.4p to 318p, after it warned full-year profits would be near the bottom of the analyst consensus range of £290.9 million to £312.1 million.
The biggest risers on the FTSE 100 Index were Travis Perkins up 94p at 1939p, Shire up 196p at 4641p, WPP up 61p at 1480p and Aberdeen Asset Management up 13.8p at 351.4p.
The biggest fallers on the FTSE 100 Index were Pearson down 49.5p at 900.5p, BG Group down 25p at 1057p, Royal Dutch Shell down 27.5p at 1775.5p and Reckitt Benckiser down 61p at 6249p.
ends
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