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Market overview: FTSE closes up 101 points

LONDON (ShareCast) – 1630: It was revealed today that inflation broke its downward trend in March, rising slightly on the month before, according to new figures from ONS. Meanwhile, an increase in the national minimum wage this year will still leave it effectively lower than it was in 2004 because of the impact of inflation, according to a new report. Looking abroad, home construction permits rose by 4.5 per cent on a monthly basis and 30.1 per cent on an annualised basis to 747,000 in March, according to the latest data from US Census Bureau. Burberry shares had a bad day after underlying revenue growth at the luxury brand eased in the fourth quarter, owing to a slowdown in growth at its Wholesale division. The FTSE 100 closed up 101 points at 5,767.

1509: The Footsie is still trading near its highest levels of the day following a strong start for US benchmarks on the back of positive housing starts data. Investors seem to have shrugged off some weaker-than-expected industrial production data. Output was flat in March, compared with the consensus estimate of a 0.3% gain. Meanwhile, heavyweights Coca-Cola and Goldman Sachs (NYSE: GSnews) are making gains after first-quarter updates. FTSE 100 (Euronext: VFTSE.NXnews) up 63 at 5,729.

1426: The main US equity benchmarks are being called to open higher by 0.8 per cent on average. Expectations of a firm start on Wall Street have driven Footsie (FTSE: ^FTSEnews) to its highest point of the day, up 64 at 5,731. Engineer and project manager AMEC (LSE: AMEC.Lnews) is wanted as it bounces back from a poor response to its trading update on Monday.

1347: US housing starts fell by 5.8pc month-on-month during March, to 654,000, versus the 705,000 expected by the consensus. On the other hand, US housing permits, which are arguably a more important indicator, have shot up to an annualized rate of 746,000, from 710,000 in February. Goldman Sachs is off by almost 1% following its latest quarterly results. Analysts at Credit Suisse (NYSEArca: CSMAnews) have also weighed in on the latest trading update from MarksSpencer; which they describe as “disappointing,” adding that, “we expect FY 2012/13 consensus profit before tax to move down by circa 2-3pc (less so on EPS given the lower tax charge) on the guidance given today.” FTSE 100 up 45 to 5,711.

1125: Spain has not often been responsible for cheery sentiment in London’s stock market in recent years, but the results of this morning’s Spanish bond auction have given heart to investors. Though the top-share index is off its highest levels, it remains above 5,700, at 5,707, up 41. Barclays (LSE: BARC.Lnews) leads the charge after Bank of America Merrill Lynch suggested the broking community could be about to up their earnings forecast for the bank. ‘With Eurozone fears hitting the shares recently, we think the first-quarter results could re-focus investors to the fundamental attractions,’ the US broker reckons. Marks and Sparks is still in negative territory after a disappointing trading update this morning. Analysts at Oriel Securities suggested that stock control at the High Street (BSE: HIGHSTREE.BOnews) bellweather might have been a bit too tight, as the chain ran out of stock of some top selling items, but a by-product of this could be an improvement in gross margins.

1018: The Footsie has extended gains following the Spanish auction which saw stronger-than-expected demand for government debt. Yields on 12- and 18-month notes still rose as anticipated but bid-to-cover ratios on both issuances were stronger than the previous auctions. Financials (Euronext: IXEFI.NXnews) are still leading the upside on London’s blue chip index with Barclays, Schroders (Berlin: PYX.BEnews) and Standard Chartered (Xetra: 859123news) making solid gains. FTSE 100 up 48 at 5,714.

0930: UK inflation broke its downward trend in March, rising slightly on the month before. The Consumer Prices Index measure of annual inflation stood at 3.5% in March 2012 – up from 3.4% in February. The rise was driven by food – particularly fruit, bread cereals and meat – clothing, as well as recreation and culture, the ONS said. Footsie is still in positive territory despite the weakness of retailers and miners. Barclays tops the risers in the top tier while in the mid-caps Afren (LSE: AFR.Lnews) is wanted after it announced it has found a potentially big oil strike in Kurdistan. FTSE 100 us up 28 at 5,694.

0833: Despite disappointing updates from two of Britain’s best known retailers, Footsie has opened on the front foot as financials claw back some of the losses seen yesterday. Burberry is the worst performing blue-chip but Marks and Spencer (LSE: MKS.Lnews) is not far behind. Fashion chain Burberry saw a slow-down in the growth rate of its wholesale division in the firm’s fourth quarter. As for Marks and Spencer, its like-for-like sales growth in the UK fell below expectations. Like-for-like (LFL) sales in the UK were down 0.7 per cent (pc) on the first quarter of 2011, with food sales up 1.0pc while general merchandise sales were down 2.8pc. The market had expected LFL sales growth of 1.5pc for food and a 0.5pc decline for general merchandise. FTSE 100 is up 12 at 5,678.

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