US markets lead FTSE 100 higher

The FTSE 100 climbed further in early trading, rising 23.46 points by 08:30 BST after US markets closed higher.

Stocks on the UK's leading shares index were lifted by Wall Street gains, as the Dow Jones rose 2.9 per cent and the S&P 500 jumped three per cent.

Optimism in the financial sector and stronger oil prices helped maintain yesterday's rally, and Lloyds Banking Group once again led the risers with a 5.2 per cent rise.

Xstrata followed closely with a 4.86 per cent rise, while Kazakhmys was up by 4.56 per cent.

But retailers threaten to drag the index lower, with Marks & Spencer falling 6.78 per cent after cutting its dividend by a third on the back of a 40 per cent profit fall.

Rival Next was also trading lower, with shares down by 2.7 per cent, while DIY chain Kingfisher saw shares dip by 1.9 per cent.

Investors will be eying inflation figures out later this morning, which will be an indicator to the state of the economy.