FTSE 100 up 2% in May but the bull’s feeling weary.

31st May 2013


The FTSE 100 closed on Friday 73.9 points down on the day at 6,583.09 but the slightly weary looking blue-chip index still managed to finish the month, which saw it hit near 13 year highs, 2% up.

The top-flight fought back in early trading on Tuesday following the long weekend and two days of declines at the end of last week. Negative data from the eurozone and some profit-taking managed to obstruct progress. Despite its monthly gain, it slid back by 1% over the week.

Official data highlighting the dire situation in regards to unemployment in the embattled eurozone hit confidence. Figures published by Eurostat, the European Commission’s statistics office, showed employment in the region had hit a new high. The seasonally adjusted unemployment rate jumped from 12.1% in March to 12.2% in April. Eurostat estimates 19.375m in the euro area were unemployed in April, a jump of 95,000 people from March. Compared with April 2012, unemployment was up by 1.6m across the 17 nations in the embattled euro region. On Monday, the European Central Bank tried to appease markets, by saying it would continue to its monetary policy as long as was needed.

Notably, over the strong month, the biggest riser was Lloyds. An upbeat address in May, from its chief executive António Horta-Osório, helped propel its shares to rally by 15% over the month to close on Friday at 62.11p, marking a 3% rise over the week. The bank this week announced it was selling a tranche of US mortgage bonds to various buyers for £3.3billion to bolster its balance sheet.

Elsewhere in the banking sector, HSBC, which recruited former MI5 boss, Sir Jonathan Evans to help battle financial crime was flat over the week at 752.p. For its part Standard Chartered was also flat at 1,537p while Royal Bank of Scotland managed to gain 3% to 338p. Barclays closed 1% better over the week at 320.45p.

The biggest faller over the week was miner, Evraz, which is expected to move to the FTSE 250 in the next topflight reshuffle after a steep fall since the start of the year. Over the week it is down 8% to 135.3p. On the other side of the chart were fellow miners, Fresnillo and Polymetal International. The former was the week’s best riser, up 7% to 1,153p, while Polymetal was at its heels, firming 6% to 690.5p respectively.

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