Stocks had pulled into positive territory by Tuesday lunchtime helped by strength in the banking sector as full-year results and the outcome of a strategic review at Barclays were well-received by the markets.

Providing some support this morning was the news that credit ratings agency Standard & Poors has changed its outlook on Ireland from 'negative' to 'stable'. The move reflects its expectation that the exchange of promissory notes for longer-term government bonds significantly reduces the Irish government's debt-servicing costs and refinancing risk, and supports medium-term fiscal consolidation.

Meanwhile, the UK CPI inflation rate remained at an annual rate of 2.7% in January, unchanged for a fourth month in a row as expected.

The FTSE 100 had a subdued day yesterday on the back of a lack of economic news and low trading volumes, partly owing to the closure of Asian markets for Lunar New Year holiday. Several of these markets still remain closed.

"Trading volumes are expected to be low again today, with focus on Mario Draghi's speech before Spanish lawmakers and Barack Obama's State of the Union address," said market analyst Craig Erlam from Alpari.
 
He said that Obama's speech is likely to attract the most attention, so close to the so-called 'sequester' at the end of the month. "The President is expected to use the address to push Congress to come to a deal which suits both parties, which given his lack of flexibility on spending cuts to this point is becoming laughable," Erlam said.

Traders were also digesting yesterday's Eurogroup meeting, where Eurozone finance ministers refrained from taking any action on either the strength of the euro or the Cyprus bailout.

FTSE 100: Barclays jumps after strategic review

UK banking group Barclays was performing well this morning after releasing the details of its strategic review, which includes 3,700 jobs cuts. Meanwhile, the company said that adjusted profits before tax grew 26% to £7.05bn in 2012, helped by a 46% improvement in Corporate and Investment Banking and 52% in Wealth and Investment Management.

Sector peers Lloyds and RBS were also on the up this morning.

Heading the other way was aerospace and defence giant BAE Systems after JPMorgan Cazenove said in its morning note to clients that the company faces "major structural problems" and is likely to underperform peers over the next 12-24 months.

In contrast, the US broker named power systems group Rolls-Royce as the "best-quality company in the sector", giving shares a boost today. Rolls-Royce also announced that it has won a $83.7m contract to build aircraft engines for the US Marine Corps and Air Force.

Security solutions firm G4S was slightly lower after saying that it will incur an overall loss worth £70m for its mismanaged Olympic Games contract.

Merger partners Xstrata and Glencore were both unwanted after publishing production reports for 2012. The firms also said the merger was still waiting on the approvals of regulators in China, amongst other things.

After an earlier fall, oil and gas giant Tullow was trading higher by lunchtimev after its partner Kosmos Energy submitted plans for three discoveries on the Deepwater Tano Block offshore Ghana.

FTSE 250: ICAP hit by downgrade

Interdealer broker ICAP was a heavy faller today after Numis Securities cut its rating for the stock to 'reduce'. Informa was downgraded by HSBC to 'underweight' and Catlin was lower after Goldman Sachs reduced its recommendation to 'neutral'.

Healthcare services provider United Drug gained after saying that trading across the group during the first quarter was strong, with revenues and profit ahead of the same period the year before.

Paper and packaging group Mondi fell after saying that full-year 2012 underlying operating profits would be below the €622m achieved in 2011.

Homewares retailer Dunelm was lower despite saying that pre-tax profits rose 14.6% to £59.8m in the first half on revenues which rose 13.4%. Oriel Securities downgraded the stock to 'add' this morning.




FTSE 100 - Risers
Barclays (BARC) 315.95p +4.79%
Lloyds Banking Group (LLOY) 54.72p +3.73%
Royal Bank of Scotland Group (RBS) 349.00p +2.56%
Morrison (Wm) Supermarkets (MRW) 261.30p +2.03%
ARM Holdings (ARM) 918.00p +1.60%
Sage Group (SGE) 339.60p +1.56%
Aberdeen Asset Management (ADN) 405.50p +1.32%
Associated British Foods (ABF) 1,776.00p +1.25%
Carnival (CCL) 2,616.00p +1.20%
BT Group (BT.A) 270.00p +1.09%

FTSE 100 - Fallers
BAE Systems (BA.) 330.50p -1.78%
GKN (GKN) 254.00p -1.51%
Evraz (EVR) 291.90p -1.39%
Antofagasta (ANTO) 1,118.00p -1.32%
Randgold Resources Ltd. (RRS) 5,785.00p -1.03%
Glencore International (GLEN) 382.55p -1.00%
Xstrata (XTA) 1,149.00p -0.99%
Fresnillo (FRES) 1,644.00p -0.96%
Reed Elsevier (REL) 687.00p -0.94%
Amec (AMEC) 1,092.00p -0.91%

FTSE 250 - Risers
Ocado Group (OCDO) 137.00p +7.62%
Moneysupermarket.com Group (MONY) 203.70p +3.14%
Pace (PIC) 234.00p +2.23%
Stobart Group Ltd. (STOB) 96.85p +1.95%
3i Group (III) 287.50p +1.91%
Perform Group (PER) 401.80p +1.72%
Jupiter Fund Management (JUP) 345.00p +1.62%
SVG Capital (SVI) 342.30p +1.57%
QinetiQ Group (QQ.) 203.20p +1.45%
Barratt Developments (BDEV) 225.00p +1.35%

FTSE 250 - Fallers
ICAP (IAP) 340.00p -4.95%
Ultra Electronics Holdings (ULE) 1,565.00p -3.93%
Supergroup (SGP) 694.00p -3.34%
Lonmin (LMI) 368.60p -2.74%
Playtech Ltd. (PTEC) 524.00p -2.51%
Diploma (DPLM) 573.00p -2.38%
Catlin Group Ltd. (CGL) 505.00p -2.13%
Chemring Group (CHG) 283.00p -1.80%
Petropavlovsk (POG) 344.50p -1.54%
Micro Focus International (MCRO) 633.00p -1.32%

BC

Related share prices
BAE Systems (BA.) share price
Barclays (BARC) share price
Lloyds Banking Group (LLOY) share price
Royal Bank of Scotland Group (RBS) share price
Rolls-Royce Holdings (RR.) share price
ICAP (IAP) share price
Tullow Oil (TLW) share price
United Drug (UDG) share price
Xstrata (XTA) share price
Catlin Group Ltd. (CGL) share price
Dunelm Group (DNLM) share price
G4S (GFS) share price
Mondi (MNDI) share price
Glencore Xstrata (GLEN) share price