London close: Corporate earnings provide a boost

- Markets lifted by a series of upbeat earnings- IMF urges Britain to do more- Economic data from the US maybe not as weak as it appearsA barrage of upbeat earnings reports from some heavyweight stocks across the US and Europe lifted sentiment today, sending the Footsie to its highest closing levels in over two months - the FTSE 100 finished at 5,714, a level not surpassed since May 3rd, when it closed at 5,767. Cyclicals such as financial and technology issues were clearly in the lead. Analyst Craig Erlam from Alpari said that corporate earnings have been a "big surprise" to many so far. "Q2 was very poor in terms of data and with profit warnings adding doubts in the lead up to the start of the season, few could predict how it's gone. But positive earnings have continued to drag the indices higher by the scruff of the neck."However, what appeared to be mixed economic data Stateside limited gains today, even if later on traders brushed them aside and pushed the benchmark index higher. Thus, sales of existing homes fell by 5.4% in June and jobless claims rose by more than expected last week. Meanwhile, the Philly Fed manufacturing index improved from -16.6 to -12.9 in June, but was still well below the -6.8 estimate.However, as regards the so-called Philly Fed survey, for example, economists at Barclays are commenting that: "Apart from the general picture of a modest rebound in manufacturing fortunes at the start of Q3, we would be wary about reading too much into the month-to-month swings in the survey, partly because it has consistently painted a weaker picture than the ISM and Empire State since the recession. "Our view remains that growth in manufacturing activity will pick up somewhat in Q3 relative to Q2, consistent with a rebound in the ISM above the 50 mark. The strength of the June industrial production report and the modest rebounds in the Empire State and Philly Fed in July broadly support this view." Retail sales in the UK also failed to spread the cheer, increasing by just 0.1% in June (+1.6% on last year), under consensus forecasts of a 0.6% rise (+2.4% year-on-year). Nevertheless, if one excludes automotive fuel sales then total sales volumes actually came in as expected. In other domestic news, the International Monetary Fund (IMF) has said that the UK needs to take more aggressive action to kick-start growth. "Repair and rebalancing of the UK economy is likely to be more prolonged than initially envisaged [...] Confidence is weak and uncertainty is high."Also a worry for markets today were surging bond yields in Spain. The Treasury issued a total of €2.98bn in near- and medium-term debt today, but saw borrowing costs soar and demand weaken significantly at all auctions. On the secondary market, the yield on a 10-year Spanish bond was up five basis points on the day at 7.012% before the close, a level seen by most as unsustainable.FTSE 100: Burberry rises on positive read-across from HermesLuxury brand Burberry was making gains after French peer Hermes reported its second-quarter results. Despite the firm revealing a slowdown in total sales growth, it noted strong demand in the key emerging markets in Asia-Pacific.Natural gas group BG was under the weather after Credit Suisse downgraded the stock to 'neutral', saying that the market has yet to fully appreciate the transitional challenges that the group faces in the upstream cycle. Mining firm Vedanta dropped after HSBC slashed its target from 1,320p to 1,000p, though it maintained its 'overweight' rating. ?Kingfisher, Europe's largest home improvement retailer, was among the worst performers after sales were hit by the extraordinary bad weather in the second quarter, though trading in the UK and Ireland was resilient. ?? Telecoms giant Vodafone dropped after US peer Verizon, in which it owns 45%, failed to talk about dividend distribution during a conference call following its second-quarter results today, following the bumper special dividend paid last year. Analysts at Jefferies last month said that Vodafone's reliance on Verizon income distributions being raised to sustain dividend growth in the future is increasing Verizon's leverage over Vodafone, "an unhealthy situation in our view."Banking group Lloyds was higher after it agreed with the Co-op to sell hundreds of its branches for an initial consideration of £350m, and up to an additional £400m in present value. ? FTSE 250: Afren and Halfords lead the rsersOil and gas group Afren jumped after positive results from its Simrit-2 exploration well in Iraq. "The latest results on the Simrit-2 exploration well confirm the transformational potential of this discovery to Afren, further validated by the test results, suggesting excellent production capability." Investors of Halfords shrugged off some disappointing profit guidance on Thursday, as the market seemed to celebrate the abrupt departure of its Chief Executive Officer (CEO) David Wild. Oilfield services firm Wood Group rose after saying that Chairman Sir Ian Wood is to retire in November and will be succeeded by the group's CEO, Allister Langlands. FTSE 100 - RisersBurberry Group (BRBY) 1,289.00p +4.63%Royal Bank of Scotland Group (RBS) 212.30p +3.92%Schroders (SDR) 1,373.00p +3.08%ARM Holdings (ARM) 491.60p +2.82%Barclays (BARC) 164.25p +2.56%ICAP (IAP) 318.80p +2.48%RSA Insurance Group (RSA) 111.60p +2.48%International Consolidated Airlines Group SA (CDI) (IAG) 160.10p +2.43%Smiths Group (SMIN) 1,099.00p +2.33%Standard Chartered (STAN) 1,519.00p +2.29%FTSE 100 - FallersBG Group (BG.) 1,290.00p -2.09%Kingfisher (KGF) 271.60p -1.31%Randgold Resources Ltd. (RRS) 5,635.00p -1.31%Vodafone Group (VOD) 183.05p -1.16%Imperial Tobacco Group (IMT) 2,509.00p -0.99%United Utilities Group (UU.) 690.50p -0.79%Vedanta Resources (VED) 902.50p -0.77%CRH (CRH) 1,204.00p -0.74%National Grid (NG.) 666.00p -0.67%Aberdeen Asset Management (ADN) 258.90p -0.61%FTSE 250 - RisersBwin.party Digital Entertainment (BPTY) 115.70p +9.88%Ocado Group (OCDO) 77.00p +8.45%Afren (AFR) 128.00p +7.65%Laird (LRD) 193.40p +6.91%Fenner (FENR) 357.60p +5.96%Bodycote (BOY) 331.70p +5.94%Elementis (ELM) 197.90p +5.49%Howden Joinery Group (HWDN) 134.10p +5.42%Yule Catto & Co (YULC) 146.00p +5.42%Paragon Group Of Companies (PAG) 183.40p +5.40%FTSE 250 - FallersAshtead Group (AHT) 254.10p -3.79%TalkTalk Telecom Group (TALK) 182.70p -3.74%easyJet (EZJ) 552.00p -1.95%Ultra Electronics Holdings (ULE) 1,567.00p -1.88%Home Retail Group (HOME) 75.20p -1.57%PayPoint (PAY) 710.00p -1.39%Sports Direct International (SPD) 290.70p -1.36%Gem Diamonds Ltd. (DI) (GEMD) 210.50p -1.22%Centamin (DI) (CEY) 66.45p -1.19%Cable & Wireless Communications (CWC) 33.28p -0.72%BC