By Sara Sjolin, MarketWatch
LONDON (MarketWatch) ? Shares in U.K. oil firms and banks jumped on Friday, as fresh comments from British Chancellor of the Exchequer George Osborne about cheap bank funding calmed markets, while reports said central bankers are ready to act if the upcoming Greek election triggers a credit crunch.
The FTSE 100 index /quotes/zigman/3173262 UK:UKX +0.02% added 0.5% to 5,493.78.
The great yield rush
The chase for yield may tempt investors to veer from their long-term investment strategies.
Oil firms did most of the heavy lifting in London as oil prices inched back above $84 a barrel. Royal Dutch Shell PLC /quotes/zigman/359915 UK:RDSA +1.44% ? /quotes/zigman/359955 UK:RDSB +0.88% ? /quotes/zigman/379078/quotes/nls/rds.a RDS.A +1.01% ? /quotes/zigman/379012/quotes/nls/rds.b RDS.B +0.79% ?added 1.5%, BP PLC /quotes/zigman/210014 UK:BP +1.16% ? /quotes/zigman/247026/quotes/nls/bp BP +1.44% ?rose 1.9% and BG Group PLC /quotes/zigman/249967 UK:BG +0.61% ?inched 1.9% higher.
Metals prices also had a positive trading day across the board, supporting solid gains for U.K. miners. Vedanta Resources PLC /quotes/zigman/336962 UK:VED +3.82% ?added 4.7%, Evraz PLC /quotes/zigman/7218774 UK:EVR +3.25% ?gained 3.4% and Rio Tinto PLC /quotes/zigman/155899 UK:RIO +0.89% ? /quotes/zigman/182541/quotes/nls/rio RIO +0.72% ?moved 2.4% higher.
Britain's Chancellor of the Exchequer George Osborne and Bank of England Governor Mervyn King.U.K. banks were boosted by a speech late Thursday by Chancellor George Osborne that the Bank of England will activate an emergency lending program under which auctions of short-term sterling liquidity can be held at any time. Osborne further said the Treasury will provide cheap funds to domestic banks if they boost lending to British households and companies. Osborne: BoE ready to activate emergency lending
Royal Bank of Scotland Group PLC /quotes/zigman/10330253 UK:RBS +7.32% ? /quotes/zigman/530544/quotes/nls/rbs RBS +4.08% ?surged 7.2%, Barclays PLC /quotes/zigman/301787 UK:BARC +3.45% ? /quotes/zigman/152323/quotes/nls/bcs BCS +3.86% ?added 4.3%, Lloyds Banking Group PLC /quotes/zigman/126322 UK:LLOY +3.73% ? /quotes/zigman/255656/quotes/nls/lyg LYG +2.22% ?rose 4.2% and HSBC Holdings PLC /quotes/zigman/13843 UK:HSBA +1.17% ? /quotes/zigman/207333/quotes/nls/hbc HBC +1.00% ?ticked 1.4% higher.
The broader U.K. stock markets tracked gains in Europe, where investors cheered a report from Reuters late Thursday, where Group of 20 officials said central bankers are ready to act if financial market conditions are strained after the Greek parliamentary election on Sunday. Central banks to act on bad Greek outcome: report
On a more downbeat note, data showed the U.K. posted its second biggest global goods trade deficit on record in April, including the biggest trade gap ever with the European Union. Goods exports slumped 8.6% from March, the largest monthly fall since July 2006, signaling weaker demand abroad. U.K. posts second biggest trade deficit on record
Among U.K. stocks heading south, British Sky Broadcasting Group PLC /quotes/zigman/143786 UK:BSY -3.06% ?declined 2.6% to ?6.54, as S&P Equity Research cut the price target to ?7.40 from ?7.60 and kept a hold rating on the stock. The price cut came after the broadcaster secured five out of seven packages to show British Premier League matches, but at a higher cost than expected.
/quotes/zigman/3173262
UK : FTSE Indices
Volume: 0.00
June 15, 2012 2:04p
/quotes/zigman/359915 UK : U.K.: London
Volume: 5.21M
June 15, 2012 2:04p
Market Cap?134.46 billion
/quotes/zigman/359955 UK : U.K.: London
Volume: 4.55M
June 15, 2012 2:04p
Market Cap?134.46 billion
/quotes/zigman/379078/quotes/nls/rds.a US : U.S.: NYSE
Volume: 2.62M
June 14, 2012 4:11p
Market Cap$209.64 billion
/quotes/zigman/379012/quotes/nls/rds.b US : U.S.: NYSE
Volume: 783,746
June 14, 2012 4:04p
Market Cap$209.64 billion
/quotes/zigman/210014 UK : U.K.: London
Volume: 30.75M
June 15, 2012 2:04p
Market Cap?79.27 billion
/quotes/zigman/247026/quotes/nls/bp US : U.S.: NYSE
Volume: 10.25M
June 14, 2012 4:02p
Market Cap$123.21 billion
/quotes/zigman/249967 UK : U.K.: London
Volume: 5.60M
June 15, 2012 2:03p
Market Cap?41.65 billion
/quotes/zigman/336962 UK : U.K.: London
Volume: 888,841
June 15, 2012 2:03p
Rev. per Employee?281,656
/quotes/zigman/7218774 UK : U.K.: London
Volume: 3.49M
June 15, 2012 2:04p
Rev. per Employee?91,343
/quotes/zigman/155899 UK : U.K.: London
Volume: 4.27M
June 15, 2012 2:04p
Market Cap?40.44 billion
Rev. per Employee?534,026
/quotes/zigman/182541/quotes/nls/rio US : U.S.: NYSE
Volume: 3.62M
June 14, 2012 4:01p
Rev. per Employee$858,542
/quotes/zigman/10330253 UK : U.K.: London
Volume: 21.99M
June 15, 2012 2:04p
Market Cap?25.36 billion
Rev. per Employee?273,387
/quotes/zigman/530544/quotes/nls/rbs US : U.S.: NYSE
Volume: 500,960
June 14, 2012 4:08p
Market Cap$197.47 billion
Rev. per Employee$423,098
/quotes/zigman/301787 UK : U.K.: London
Volume: 54.78M
June 15, 2012 2:04p
Market Cap?23.58 billion
Rev. per Employee?305,514
/quotes/zigman/152323/quotes/nls/bcs US : U.S.: NYSE
Volume: 5.98M
June 14, 2012 4:00p
Rev. per Employee$487,429
/quotes/zigman/126322 UK : U.K.: London
Volume: 261.41M
June 15, 2012 2:04p
Market Cap?20.93 billion
Rev. per Employee?354,191
/quotes/zigman/255656/quotes/nls/lyg US : U.S.: NYSE
Volume: 1.47M
June 14, 2012 4:04p
Rev. per Employee$552,300
/quotes/zigman/13843 UK : U.K.: London
Volume: 31.65M
June 15, 2012 2:04p
Market Cap?99.36 billion
Rev. per Employee?244,345
/quotes/zigman/207333/quotes/nls/hbc US : U.S.: NYSE
Volume: 2.38M
June 14, 2012 4:01p
Market Cap$154.68 billion
Rev. per Employee$369,480
/quotes/zigman/143786 UK : U.K.: London
Volume: 6.66M
June 15, 2012 2:04p
Market Cap?11.26 billion
Rev. per Employee?427,465
Sara Sjolin is a MarketWatch reporter, based in London.
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