London close: Stocks rally strongly after Swiss move as ECB stimulus hopes rise

The FTSE 100 finished the session 110.32 points higher at 6,498.78, up 1.7% on the day due to increased speculation about a new potential quantitative easing (QE) programme by the European Central Bank next week.

Equities had dropped sharply into the red mid-morning, with the FTSE 100 falling as low as 6,298.15, after the SNB abandoned its minimum exchange rate for the franc.

"As the day has progressed the panic caused by the SNB has subsided, and hope for Eurozone QE has seen markets rally into the close with the FTSE battling to post a triple-digit gain," said analyst Alastair McCaig from IG.

With exactly one week to go before the ECB's policy meeting on 22 January, analysts said the SNB's move was pre-emptive ahead of a possible ECB government bond-buying programme. According to Connor Campbell from Spreadex, "the SNB appears to have decided it would be unable to maintain its currency cap in the face of such wide-spread stimulus".

US economic data came in mixed on Thursday, with jobless claims unexpectedly rising to a four-month high and regional manufacturing surveys moving in opposite directions.

Gold miners surge, Afren rockets

Gold mining stocks were performing well after UBS said they are “well-placed to benefit from FX and oil weakness” compared with their industrial metal peers. Precious-metal producers Randgold Resources and Fresnillo were the best performers.

Afren, the oil group which plummeted this week after reserve estimates were cut for a part-owned project in the Kurdistan region of Iraq, soared over 32% by the close on the back of takeover speculation. Nigeria's Seplat, which had approached Afren last month, said on Thursday that it had secured an option to raise $700m of debt to fund acquisitions. It has until 19 January to return to the table and bid for Afren.

Third-quarter organic revenue was flat at information services group Experian, but weakness in some divisions was offset by a strong performance in the core credit services unit, causing shares to rise.

Tullow Oil erased early gains as investors digested an trading update that showed the company was taking billions of dollars-worth of write-offs and impairment charges. The group also said profits more than halved last year due to the collapse in crude prices, as it lowered its exploration budget for 2015.

Estate agency Savills impressed with a trading update, while statements from Home Retail, Booker and Bovis Homes disappointed.

Market Movers
techMARK 2,985.44 +0.88%
FTSE 100 6,498.78 +1.73%
FTSE 250 15,915.29 +0.27%

FTSE 100 - Risers
Randgold Resources Ltd. (RRS) 5,265.00p +6.36%
Experian (EXPN) 1,121.00p +5.26%
Morrison (Wm) Supermarkets (MRW) 188.10p +5.03%
Sainsbury (J) (SBRY) 255.30p +5.02%
BHP Billiton (BLT) 1,348.00p +4.90%
Fresnillo (FRES) 855.00p +4.78%
Royal Dutch Shell 'B' (RDSB) 2,129.00p +3.75%
Associated British Foods (ABF) 3,147.00p +3.69%
Shire Plc (SHP) 4,663.00p +3.62%
Prudential (PRU) 1,515.50p +3.55%

FTSE 100 - Fallers
Kingfisher (KGF) 318.60p -3.22%
Imperial Tobacco Group (IMT) 2,850.00p -2.80%
Dixons Carphone (DC.) 434.40p -2.16%
Glencore (GLEN) 240.60p -1.39%
Taylor Wimpey (TW.) 124.10p -1.35%
Compass Group (CPG) 1,091.00p -1.27%
Tullow Oil (TLW) 354.90p -0.84%
Persimmon (PSN) 1,456.00p -0.82%
Antofagasta (ANTO) 670.00p -0.74%
InterContinental Hotels Group (IHG) 2,601.00p -0.57%

FTSE 250 - Risers
Afren (AFR) 28.76p +32.29%
Polymetal International (POLY) 591.00p +9.55%
Savills (SVS) 699.50p +7.29%
Acacia Mining (ACA) 299.70p +4.79%
Cairn Energy (CNE) 170.70p +4.34%
Premier Oil (PMO) 137.60p +4.24%
Kaz Minerals (KAZ) 177.20p +3.99%
Serco Group (SRP) 159.90p +3.90%
Soco International (SIA) 259.30p +3.55%
Game Digital (GMD) 250.00p +3.31%

FTSE 250 - Fallers
Vedanta Resources (VED) 375.80p -7.94%
Spire Healthcare Group (SPI) 315.00p -7.30%
Bovis Homes Group (BVS) 769.50p -6.10%
Home Retail Group (HOME) 199.10p -6.08%
Hikma Pharmaceuticals (HIK) 2,250.00p -4.94%
Petra Diamonds Ltd.(DI) (PDL) 171.60p -4.88%
Enterprise Inns (ETI) 106.10p -4.41%
IG Group Holdings (IGG) 709.50p -4.38%
Booker Group (BOK) 155.70p -4.24%
IP Group (IPO) 221.00p -2.64%