Solid earnings, ECB rate cut prospects lift FTSE

The benchmark share index rose on Tuesday, inching back towards its 2013 highs after upbeat earnings reports from BP and Lloyds bank and on expectations for a European Central Bank (ECB) rate cut this week.

"We're looking forward to a possible ECB rate cut later this week. That stimulus has kept everyone upbeat," said Darren Easton, director of trading at Logic Investments.

Expectations of fresh stimulus measures and rate cuts from world central banks, such as the ECB and U.S. Federal Reserve, have boosted equity markets. The lower rates and injections of liquidity should help companies export more overseas and have also led investors to shift money out of bonds and into equities for better returns.

Easton said he had taken out "long" positions to bet on further gains for the FTSE this week.

"We wouldn't want to bet against this market going higher in the near term."

Solid results from leading UK companies supported sentiment.

According to Thomson Reuters Starmine data, 80 percent of companies who have reported first-quarter results in the broader FTSE 350 index, which comprises the FTSE 100 and the FTSE 250 mid-cap sector, have beaten or met expectations.

 Oil major BP continued that trend on Tuesday with forecast-beating first-quarter profits, sending BP shares up 2.

Part-nationalised British bank Lloyds also posted higher first-quarter profits to send its shares up by 5.1 percent to the top of the FTSE 100's leaderboard.

The FTSE 100 has risen by nearly 10 percent since the start of 2013 but some traders expect the market to trade sideways or fall slightly in the next couple of months as some investors sell shares in order to book profits on the rally.

"I would still sell strong rallies on the FTSE," said Hartmann Capital trader Basil Petrides.

(Editing by Susan Fenton)

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Article source : http://uk.reuters.com

Axa plans to axe final salary pension scheme

Axa will move almost 2,500 staff on to a defined contribution scheme, with future payments dependent on the performance of the underlying fund

Financial services group Axa has announced plans to close its final salary pension to existing members, in a move one union claimed would result in employees having to work an extra five years to achieve the same retirement pay out.

The company told staff it planned to move 2,300 employees currently in the scheme to a defined contribution pension, where payments are not guaranteed and depend on the performance of the underlying fund. These schemes are cheaper to run as the investment risk is transferred from the employer to the employee.

Axa, which provides pensions and other financial products, will shift the risk on to its members.

 In common with many other firms Axa, whose business is providing pensions alongside other financial products, had already closed the final salary scheme to new members. Since 2003 they have been enrolled in a defined contribution scheme.

"We have worked hard to maintain our defined benefit (final salary) pension scheme over the past few years and have introduced a number of changes to try to keep the scheme sustainable," a spokesperson said. "Like many other companies before us, we are now proposing that the scheme be closed pending a further 60 days of consultation."

Benefits that have already been accrued in the scheme will be kept. The spokesperson added: "This allows us to harmonise pension arrangements in a fairer way across our employee base and ensure that all of our employees have access to long-term pension provision."

Unite, Britain's biggest union and the representative for Axa staff, expressed anger over the plans and said it could not rule out industrial action. It said it had put forward a range of alternatives including possible changes to members' contributions or accrual rates, but these had all been rejected by Axa.

Unite's national officer, Dominic Hook, said: "The move to end the defined benefit pension scheme at Axa is appalling and unjustified. Long-serving staff now face the prospect of having to work an extra five years to get the same level of pension and [the move] puts all the investment risk on to the staff."

He added: "The decision by Axa is unacceptable and industrial action will be among the options being discussed with members if Axa refuses to reconsider its proposals."

Azure is led by experienced Chartered Accountants and business advisers and specialises in providing online accountancy services to owner managed businesses.Azure Global’s vision is to be widely recognized as a reputed firm of financial business advisors, achieving real growth for ambitious companies and to become the first choice for F&A outsourcing for accountancy practices and businesses alike for more info visit our site Azure Global and join us On Facebook 

Article source : http://www.guardian.co.uk