Leading shares have shrugged off the prospect of a US rate rise in December and the continuing concerns about security in the wake of the Paris attacks.
The FTSE 100 is up 65.05 points at 6344.02, with analysts pointing out that markets have hated the recent uncertainty over US rates, so any signs of a decision would be welcomed. The Bank of Japan keeping its rates on hold has also given some support. Connor Campbell, financial analyst at SpreadEx said:
After months of wishy-washy, non-committal statements from Yellen and co., the market-dragging uncertainty that has dominated periods of 2015 appears to be dissipating. Of course, markets being as fickle as they are there could soon be a switch in sentiment and a return of rate-hike fearing investors. However, for now the positive trading coming out of the US is lifting the markets as a whole.
Johnson Matthey is leading the way, up 181p or more than 7% to £26.38 after the technology group and platinum specialist said it would return £305m to shareholders as a special dividend, representing 150p a share. The move comes after it sold its gold and silver refining and research chemicals businesses. The company - which had been caught up in the fallout from the VW emissions scandal since it makes catalytic convertors - also reported a 4% dip in half year profits to £208.3m. It said the full year outlook was in line with expectations.
It expected diesel cars to be “an important part of the mix” going forward despite the VW scandal, and said it expected a number of petrol cars would need advanced filter technology to meet new standards. It forecast “average sales value per vehicle to approximately double for those engines requiring additional particulate control.”
Analysts at Jefferies said the statement was reassuring:
Johnson Matthey is confident it has the technologies to meet new legislation. Tightening of emissions requirements should continue to present opportunity for the catalyst providers, in our view.
MIning shares were among the risers, partly on the basis that if the Fed raises rates it must be confident about the outlook for the global economy. Meanwhile BHP Billiton is 24.1p better at 904.8p after it said keeping a strong balance sheet would be a priority and it would update shareholders on its dividend - which investors fear could be under pressure - in February.
The company faced protestors at its annual meeting after the recent dam disaster in Brazil.
Elsewhere Royal Mail has risen 26.7p to 480.9p after its results, while Compass has climbed 29p to £10.85 after better than expected figures from peer Sodexo.
But Bovis Homes has disappointed with its figures, down 84.5p at 904.5p which has undermined the rest of the sector. Persimmon has fallen 21p to £18.44, Berkeley Homes has lost 33p to £31.06 and Taylor Wimpey is 0.6p lowre at 185.1p.
Among the mid-caps Poundland has plunged nearly 19% to 226.2p after a 26% fall in first half profits and a warning of volatile trading conditions.
But Qinetiq has added 19.4p to 255.1p as the defence technology group issued a postive trading update and announced a £50m share buyback.
Lower down the market, financial services group Walker Crips has jumped nearly 13% to 46.875p, its biggest one day rise for more than three years after half year revenues rose 22% to £13.3m, with pretax profit up five-fold to £589,000, despite difficult markets and a rise in regulatory costs.
Barker Poland Asset Management made a first time contribution after its acquisition in March this year, and chairman David Gelber said: “We continue to increase the proportion of our revenues earned as fees, rather than through transaction driven commissions.”
The interim dividend has been lifted by 9%, and Gelber promised increasing payouts “as we look to the future with growing confidence.”
