Barclays' note to investors seems to have helped out UK financial stocks for the second day in a row.
Britain's banks have continued their gains on the stock market, with Barclays' upbeat profit prediction from yesterday still fuelling positive investor sentiment in the sector.
Fresh from Monday's 72 percent advance on the FTSE 100, Barclays was up by another 0.9 percent at 90p at 12:30 GMT. Other banks posting a second day of gains included RBS, up another ten percent, and the Lloyds group, up five percent.
The FTSE 100 index itself was 1.49 percent down on the day.
Bank stocks were battered all last week, with investors reacting badly to news of the government's latest bailout plan for the financial services sector. There were particular concerns that the Treasury's increasing of its stake in one of the participating banks, RBS, would lead to a spate of nationalisations - decimating the value of shareholdings in the firms involved.
The turnaround on Monday followed the release of a reassuring open letter from Barclays bosses, telling investors that the bank would not require government money and would post better-than-expected 2008 profits next month.
Chris Hossain, senior sales manager at ODL Securities, told Reuters: "The soothing noises coming from the financial sector have given the markets a breather from the downward spiral… we may see some relative safety in the equity markets [today]."
Sterling was also markedly boosted today, gaining 0.5 percent to $1.408 against the dollar and 0.76 percent to €1.069 against the euro. The currency has weakened dramatically recently due to uncertainty over the UK's economic prospects, falling to a 24-year low against the dollar earlier this week.
