Footsie gains despite US Federal reserve comments

The benchmark index struggled for direction early on but finished 27.83 points ahead at 5342.92 as the Fed boss gave no hint of an imminent rise in interest rates.

Mr Bernanke told Congress yesterday a weak job market and tame inflation warrant low interest rates for "an extended period", dampening speculation a policy tightening might be nearing.

In his first appearance before Congress following a testy confirmation vote in the Senate last month, Bernanke offered a relatively sombre assessment of the US economy despite recent signs of strong growth.

The country has lost 8.4 million jobs in a little more than two years in the most severe economic downturn since the Great Depression. The Fed chief said job losses were abating, but also acknowledged the recession's toll on American workers.

US markets also rose despite a surprise fall in home sales during January, but a raft of major results due today and tomorrow – as well as revised UK output figures – will be the main factor in deciding where the Footsie finishes the week.

The pound managed to gain only slightly to stand at 1.54 against a weakening dollar on Mr Bernanke's comments, although sterling slipped below 1.14 against the euro.

Most banks were on the front foot yesterday as the sector prepared for annual results from the part-nationalised pair of Royal Bank of Scotland and Lloyds Banking Group.

RBS, which is due to report figures on Thursday, was 1/8p up at 361/8p, while Lloyds added 13/4p to 531/2p. HSBC – the subject of speculation that it may scrap a pay rise for its chief executive – lifted 171/4p to 7173/4p.

The strongest top flight riser was cruise giant Carnival, which added 83p to 2429p after citing strong demand for 2010 departures and plans for price hikes.

The biggest fall was experienced by Wolseley, which fell 51p to stand at 1579p as the builders' merchant gave up some of the gains seen on Tuesday after its profits upgrade.

Wolseley's decline also reflected cautious comments from rival Travis Perkins, which fell 4 per cent as it warned there was no clear indication when its markets might return to growth.

It underlined this by reporting a 2.7 per cent drop in like-for-like sales for the first seven weeks of the year, following on from an 11 per cent decline in full-year profits. Travis shares were down 401/2p to 710p.

Housebuilder Barratt Developments also failed to shine after posting half-year results yesterday. While the company's figures were in line with expectations and included margin improvement, analysts at Investec Securities noted that management had reduced guidance on volumes for the full year.

Barratt shares fell 7p to 1143/4p, while Persimmon dropped 161/2p to 393p, Bovis Homes eased 103/4p to 3687/8p and Taylor Wimpey declined 11/8p to 363/8p.

Price comparison firm Moneysupermarket moved in the opposite direction, rising 21/2p to 72p as it posted a 26 per cent fall in full-year earnings but said it remained confident about prospects this year.

Confused.com owner Admiral benefited from its rival's comments as shares in the FTSE 100 Index listed company rose 11p to 1210p, a gain of almost 1 per cent.

The biggest Footsie risers were Carnival, Lloyds, HSBC, and Rolls-Royce ahead 11p to stand at 5371/2p.

The biggest fallers were Wolseley, Johnson Matthey off 29p to 1560p, Reckitt Benckiser down 53p to 3427p and Land Securities slipping 8p to 6361/2p.