The FTSE has rallied in the afternoon session and is back around the 5380 level at 4.15pm in London.

After a disappointing morning session that saw London’s blue chips drop some 80 points, the FTSE 100 index is approaching the close of the day in much the same state as it arrived at its open. Lloyds Banking Group’s impressive £1.6 billion profit for the first half of the year has led the FTSE’s recovery, offering further signs of a general revival for the UK banking sector. Next is at the foot of the leader board, plunging 8.32% after Britain’s second largest clothing retailer warned that consumer spending might cool in the second half of the year.

In the US, an ADP employment report released today has shown a better-than-expected gain of 42,000 jobs in the private sector for July. This is the sixth successive month of gains, and comes with an upwardly-revised figure for the previous month. While this is a positive trend, there has been no acceleration over the course of the six months, with the average increase being only 37,000 per month, suggesting the market is still struggling to actually create sustainable employment opportunities.