* FTSE up 2 percent as Fed introduces $600 billion stimulus
* Financials gain, Man Grp results, BoE holds rates, QE
* Rolls Royce slides on engine concerns, flights grounded
By David Brett
LONDON, Nov 4 (Reuters) - Britain's top shares closed at
their highest in nearly 29 months on Thursday as investors
responded bullishly to the U.S. Federal Reserve's decision to
pump more cheap money into the economy to boost flagging growth.
Financial stocks, led by Man Group <EMG.L> and mining and
energy shares such as BHP Billiton <BLT.L> and BP <BP.L>, surged
higher as riskier assets around the world rose despite concerns
the programme could do more harm than good. []
The FTSE 100 <> closed up 113.82 points or 2 percent at
5,862.79, its highest since June 9, 2008, after the Fed
committed to buy $600 billion in government bonds to support a
struggling U.S. economy on Wednesday.
"The market's reacted positively to QE and there's a risk on
environment, with data out of the U.S. better, the concerns
about a slowdown are less pronounced," said Phil Poole, global
head of macro investment strategy at HSBC Global Asset
Management.
There was good economic news from the United States on
Thursday where non-farm productivity rose faster than expected
in the third quarter, while unit labour costs fell.
New U.S. claims for unemployment benefits rose more than
expected last week, underlining the persistent weakness in the
jobs market which is threatening the recovery.
[] []
Financial stocks were top gainers. The world's largest
listed hedge fund firm Man Group <EMG.L>, up 14.6 percent,
reported upbeat first-half results. []
Banks <.FTNMX8350> provided much of the index's strength.
SHOWING THEIR METAL
Miners <.FTNMX1770> rose in tandem with metals, which
benefited as the dollar index <.DXY> fell to an 11-month low
after the Fed's announcement.
Anglo-Australian miner BHP Billiton's <BLT.L> rose 6.6
percent after Canada blocked its $39 billion bid for Potash Corp
<POT.TO>. []
Energy <.FTNMX0530> shares were higher helped by a 1.7
percent spike in the price of crude <CLc1>. BP <BP.L> added 1.3
percent. The oil major beat profit forecasts on Tuesday.
Elsewhere, Unilever <ULVR.L> jumped 6.3 percent after the
consumer goods group's third-quarter results. []
On the downside, Wm Morrison Supermarkets <MRW.L> fell 3.9
percent after warning shoppers were likely to remain under
pressure into the second half of 2011. []
Next <NXT.L>, which said it expected sluggish growth in the
fourth quarter on Wednesday, shed 2.2 percent, while Marks &
Spencer <MKS.L>, which reports next week, was 1.6 percent lower.
Rolls Royce <RR.L> slipped 5 percent after Qantas Airways
suspended flights of its Airbus A380 fleet after engine failure
triggered an emergency landing in Singapore. Qantas A380s use
Rolls-Royce Trent 900 engines. []
Experian <EXPN.L> fell 1 percent as Credit Suisse downgraded
the credit checking company.
The European Central Bank kept its main interest rate on
hold at a record low of 1.0 percent for the 18th month running
on Thursday, as expected by economists.
Momentum underlying the euro zone's economic recovery
remains positive but uncertainty about the outlook still
prevails, European Central Bank President Jean-Claude Trichet
said.
(Editing by Jon Loades-Carter)
