Results beef up FTSE 250 Index

The FTSE 100 Index closed down 11 points at 5916

Published: 9:10am, 22nd February 2012
Updated: 7:38am, 23rd February 2012

Bullish results from housebuilder Galliford Try and recruitment firm Hays have helped the FTSE 250 Index outshine its top-tier partner.

The FTSE 100 Index fell 11.7 points to 5916.6 amid weak eurozone and Chinese economic data and continued worries about whether Greece's second rescue deal will save the debt-ravaged nation from default.

But the mood in the second tier was boosted by a series of better-than-expected results, helping it rise 0.6% and bucking the wider market trends in Europe and the US.

Wall Street's Dow Jones Industrial Average followed European markets into the red, as traders weighed up purchasing managers' index data that revealed the eurozone's services and manufacturing sector shrank in February.

The pound plunged against all major currencies as minutes from the Bank of England suggested the prospect of further quantitative easing, following the £50 billion boost earlier this month. Sterling was down at 1.57 against the dollar and at 1.18 against the euro.

In London's FTSE 250 Index, Galliford Try rose 9% after it revealed a better-than-expected 89% surge in pre-tax profits in the six months to December 31 to £32.2 million and doubled its dividend. The group, which saw shares lift 44p to 545p, said it was encouraged by the continued strength of the market in the first seven weeks of 2012.

Rival Barratt Developments also rose 8% after revealing reservations were 21% higher over the same period as the acquisition of land at attractive prices during the economic downturn continues to boost its recovery.

Barratt, which saw shares increase 10.1p to 139.8p, said recent trading reinforced its optimism after a return of half-year profits with a surplus of £21.6 million for the six months to December 31, compared with losses of £4.6 million a year ago.

Recruitment firm Hays was another leading riser as it offset trading pressures in the UK and Ireland to post a 24% improvement in interim profits. Shares rallied 8%, or 6.4p, to 87.4p, even though the company cut its dividend.

But the mood in London's leading shares index remained depressed as the weaker eurozone figures compounded a preliminary reading on an HSBC index suggesting China's manufacturing may shrink for a fourth month in a row in February.