Greece bailout hopes see Footsie back in the black

Hopes for a bailout rose after reassuring statements from Greece's finance minister and the head of the European Central Bank – although optimism was dampened by a downgrade by Fitch Ratings agency.

London's FTSE 100 Index rose 58.28 points to 5770.98 – recovering losses seen on Thursday as the market headed back towards recent highs.

Stock markets across the world rebounded as fears about an outright default by Greece eased – a day after the country's cost of borrowing soared.

The Dow Jones Industrial Average on Wall Street was more than 50 points higher at the time of the London close as signs of a sustained economic recovery boosted US trading.

Thursday's upbeat news from the retail sector was followed yesterday by a positive report on wholesale inventories, providing further evidence that the world's biggest economy is improving.

Wholesale inventories rose more than expected in February and sales climbed to their highest level since October 2008, according to a government report that pointed to manufacturing strength.

Total wholesale inventories increased 0.6 per cent, the Commerce Department said, from an upwardly revised 0.1 per cent gain in January. Wholesale inventories in January were previously reported to have slipped 0.1 per cent. Economists had expected stocks of unsold goods at US wholesalers to rise 0.4 per cent in February.

Corporate news was somewhat thin on the ground in the UK, but economic data came under the spotlight as official figures showed factory gate prices rose at their fastest rate in 16 months in the year to March.

This reignited fears over inflationary pressures and raised the potential for interest rate hikes, which strengthened the pound.

Sterling rose to 1.53 against the US dollar, but fell back to 1.13 against the euro as pressure on the single currency eased in the wake of fresh Greece hopes.

There was also cheer in the UK retail sector after John Lewis said department store sales jumped 30 per cent during Easter week. This added to better-than-expected sales figures from Marks & Spencer on Thursday.

M&S, which said like-for-like sales rose 5.1 per cent in its fourth quarter, added 23/4p to 3701/4p, while Next improved 30p to 2271p.

Commodity stocks were among the biggest share risers on the Footsie, led by silver miner Fresnillo with a 30p gain to 884p.

Royal Dutch Shell was also 351/2p higher at 1887p, with rival BP up 4p to 6411/8p, even though oil prices slipped just below 85 dollars a barrel.

Insurer Aviva joined them on the risers' board after the group said it was planning to expand in the fast-growing Asian general insurance market, returning to Singapore after an absence of five years.

Its shares lifted 83/4p to 388p.

The recent signs of economic recovery have also helped recruitment firm Michael Page International, which rose more than 3 per cent in the second tier after a positive trading update.

The group said profits were up 8 per cent in the first quarter, helped by a turnaround in the UK jobs market. Shares lifted 151/2p to stand at 439p.

Also in the FTSE 250, directories firm Yell was 2p dearer at 461/2p after ratings agency Standard & Poor's revised its outlook on the company to stable from negative.

The four biggest Footsie risers were Fresnillo, Compass which rose 16p to 540p, Xstrata up 36p to 1299p and British Land ahead 13p to 485p.

The biggest Footsie fallers were Schroders NV down 15p to 1153p, Wolseley off 10p to 1561p and Rolls-Royce falling 31/2p to 616p.