London shares rise

London shares made modest gains on Thursday as British retail sales climbed and the US economy continued its slow pace of recovery.

The benchmark FTSE 100 index closed just 0.03 percent higher at 5,834.51 points.

"Where central bank intervention is concerned, bad news is most definitely good news. The Philadelphia Fed index came in at -7 for August, an improvement over July's abysmal reading, but still quite anaemic," said Chris Beauchamp, Market Analyst at IG Index.

"A sluggish economy thus makes it more likely that the Fed will take action, with yesterday's inflation data showing that 'Helicopter Ben' has room to manoeuvre as far as consumer prices are concerned, " he added.

In other news, the Office for National Statistics said that retail sales rose 0.3 percent in July after a gain of 0.8 percent in June, boosted by petrol promotions and high levels of discounting, the Office for National Statistics said Thursday.

Market expectations had been for a flat reading, according to analysts polled by Dow Jones Newswires, while the ONS revised upward July's level after an initial gain of 0.1 percent.

Sales in July meanwhile surged by 2.8 percent compared with the same period a year earlier, exceeding forecasts for a rise of 1.6 percent.

The July trading period covered two days of the London 2012 Olympics -- July 27 and 28 -- but the ONS added that feedback from retailers suggests there was no impact on sales.

Lloyds remained the most traded issue with 150 million units being exchanged. Vodafone saw 85.2 million shares being exchanged in quiet trade

However, IMI was the star performer, jumping 3.84 percent -- or 34 pence -- to 918.5 pence.

Lloyds was also in demand up 3.22 percent -- or 1.03 pence -- to close at 32.985.

Pennon was the biggest casualty, falling 1.90 percent -- or 14.50 pence -- to 749.5 pence.

Eurasion was also under heavy selling pressure dropping 1.90 percent -- or 7.20 pence -- to close at 372.4 pence.

On currency markets, sterling increased to $1.5737 at 5:03 pm from $1.5683 and slipped 1.2738 euros from 1.2760 euros at the same time on Wednesday.

Source: http://news.yahoo.com/london-shares-rise-161903268.html

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