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Airline stocks rise on strong traffic figures

The FTSE 100 Index paused today at the end of a momentous week in which the Dow Jones Industrial Average closed above 17,000 for the first time.

With further impetus unlikely due to the July 4 holiday in the United States, the FTSE 100 Index stuttered in its own pursuit of a new record, with the top flight down 0.4 points at 6864.8.

Depsite signs that the US is recovering fast from the bad weather that prompted a GDP contraction in the first quarter of the year, the pound was steady against the dollar, at 1.71, and the euro, at 1.26.

Mining stocks, which have climbed in recent days on the back of improved economic news, dominated the fallers board as Rio Tinto dipped 16.5p to 3281.5p and Anglo American fell 10p to 1515p.

Some of the biggest gains of the session were seen in the airline sector after it emerged that the number of passengers flying with low-fare airlines Ryanair and easyJet increased last month despite the French air traffic control strike.

Luton-based easyJet climbed 28p to 1376p, a rise of 2%, as shares in the sector recovered from recent weakness. British Airways owner International Airlines Group was 3.6p higher at 368.8p.

BT was also on the risers board, up 1.6p to 390.5p, after its pension scheme trustee agreed an insurance deal to protect it against members living longer than expected.

ITV rose 0.5p to 184.2p after analysts at UBS upgraded the stock from 'neutral' to 'buy', saying it expects the broadcaster's first-half results to be solid driven by its World Cup coverage.

Sports Direct was another faller, giving away some of the gains made in yesterday's trading, after reports claimed leading investors in the company were set to vote against the re-election of some board members in protest at its bonus scheme. The stock fell 10.3p to 758.8p

Outside the top flight, shares in troubled outsourcing firm Serco fell 1.7p to 361.1p after it lost out in the battle to continue running the Docklands Light Rail franchise it has operated since 1997.

A note from Oriel Securities on Serco said: "This loss today shows that Serco has fights on its hands to hold on to business as well as restore new win momentum."

Among other FTSE 250 stocks, online supermarket retailer Ocado was once again one of the big movers, falling 15.3p or 3.5% to 424.7p after two days of solid gains seen as it signalled it is on track to post its first annual profit in 12 years.

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