FTSE follows Wall Street lead into positive territory

A late round of buying helped the Footsie avoid a fifth straight

session in the red as a strong open on Wall Street offset UK gloom after the 0.1 per cent economic growth came in well below the 0.4 per cent expected in the City.

The FTSE 100 pulled into positive territory to close 16.54 points higher at 5276.85 after US stocks were buoyed by a round of strong corporate earnings reports.

A stronger than anticipated US consumer confidence survey also helped the upbeat mood as the Dow Jones Industrial Average gained 0.5 per cent in early trading.

Consumer confidence in January hit its highest level in nearly a year and a half, but a closely watched US housing index showed an unexpected decline in November home prices, giving a mixed picture of the economic recovery.

The Conference Board, an industry group, reported that consumer confidence rose for the third straight month in January, driven by improved economic conditions.

Its index of consumer attitudes rose to 55.9 in January, the highest reading since September 2008 and up from an upwardly revised 53.6 in December.

Sentiment had been dogged by concerns over Asian economies, with slowing growth in South Korea adding to persistent worries over lending curbs in China.

Ratings firm Standard & Poor's has also downgraded its outlook for the Japanese economy.

Following the UK output data, currency markets bet on interest rates staying low for longer to underpin recovery. The pound edged below 1.61 against the dollar at one stage and also slid to 1.14 against the euro.

In London, heavyweight commodity stocks were the leading casualties as worries over global growth lingered. Miners Fresnillo and Kazakhmys were down 161/2p to 698p and 30p lower at 1274p respectively as the sector littered the blue-chip fallers' board.

Inter-dealer broker ICAP led the fallers, continuing its decline on concerns over potential US reforms restricting share dealing by banks. Shares were off 143/4p to 380p.

Lloyds Banking Group and Royal Bank of Scotland were also key losers – down 11/4p to 513/4p and 1/2p to 343/4p respectively.

In corporate news, software firm Sage was flat at 2373/4p after the business said it was still waiting for signs of a market recovery.

Utility Severn Trent made early progress after a trading update highlighted stabilising bad debts despite a sharp rise in burst pipes due to the cold snap.

Shares were 4p higher at 1141p.

Among the risers, the session saw a shift into defensive sectors amid uncertain prospects. Imperial Tobacco was 39p better off at 2030p.

The major grocers also advanced as investors put their money into less risky areas, with Morrisons 33/4p ahead at 2943/4p and Tesco 31/4p higher at 4187/8p.

Broker comments also provided some momentum. Asian-facing bank Standard Chartered was up 36p to 1481p after brokers upgraded the firm to buy, while positive comments from Morgan Stanley on European airlines helped British Airways add 11/4p to 2083/4p.

Citigroup meanwhile lifted its price target on budget airline easyJet, which added 91/2p to 3961/2p in the FTSE 250.

The biggest Footsie risers were Standard Chartered, Segro ahead 71/8p to 3231/8p, British Land lifted 91/4p to 4471/2p and Invensys advanced 61/4p to 308p.

The biggest fallers were ICAP, Tullow Oil slipped 45p to 1216p,

Fresnillo and Kazakhmys.