FTSE posts meagre gains as Wall St fails to inspire

The FTSE 100 Index soared to the 5600 level at one stage after news of a surprise rebound in China's exports sparked off recovery hopes.

But a lacklustre opening on Wall Street and lingering concerns over last Friday's disappointing jump in US unemployment figures saw gains ease back, to leave the Footsie closing up 3.83 points at 5538.07.

Investors on Wall Street waited for the start of an earnings season that will show whether profits and outlooks will be strong enough to extend stocks' advance.

Aluminum producer Alcoa Inc rose 1.3 per cent to $17.24 ahead of its fourth-quarter earnings announcement. As the first Dow component to report results, Alcoa unofficially launches the earnings season.

Miners and energy stocks had been the biggest beneficiaries of economic confidence following the Chinese report, which showed an 18 per cent rise in December exports after what had been 13 months of declines.

A weaker US dollar – down around 0.6 per cent against the pound, at 1.62 US dollars – had helped the sector, with oil also pushing up to 84 dollars a barrel at one point.

However, shifting sentiment left miners trailing at the close, while oil also sunk back below 83 dollars a barrel.

Kazakhmys, which had been high up the risers' board, closed down 7p to 1492p, with fellow miner Eurasian Natural Resources the biggest Footsie faller, down 24p to 1010p.

Oil companies managed to hold on to most of their gains seen earlier in the session. BP closed up 133/4p to 6351/2p and Royal Dutch Shell lifted 18p to stand at 1853p.

But it was the property sector that was the star performer after Goldman Sachs forecast a recovery in European real estate and recommended buying stocks with exposure to the London office market.

Land Securities was the top blue chip gainer after adding 19p to 683p, while British Land gained 12p to 4733/8p.

Retail shares also managed to make good progress after the run of positive festive trading updates continued with the Co-op and House of Fraser.

Marks & Spencer has been on the back foot in recent days but rallied 85/8p to 375p, while B&Q owner Kingfisher was up 51/4p to 2303/4p and Argos owner Home Retail Group added 43/4p to 2835/8p ahead of its own trading update later in the week.

In the FTSE 250 Index, Debenhams lifted 23/4p to 78p as analysts said House of Fraser's 7.1 per cent rise in Christmas sales fuelled expectations of having a positive result from the department store group today.

Elsewhere, Blacks Leisure was another in positive territory, ahead 10 per cent, or 43/4p, to 541/2p thanks to news that the cold snap had boosted winter sales.

But back in the top flight, insurance stocks and banks were suffering. Part-nationalised Royal Bank of Scotland and Lloyds Banking Group dropped 1/8p to 35p and 3/4p to 561/8p respectively as they pulled back after a recent strong rebound.

The biggest Footsie risers were Land Securities, TUI Travel ahead 71/8p to 271p, British Land and BG Group ahead 29p to stand at 1223p.

The biggest Footsie fallers of the session were Eurasian Natural Resources, Standard Chartered off 34p to 1590p, Legal & General down 13/4p to 821/2p and SAB Miller, which finished the day down 37p to stand at 1801p.