FTSE ends 0.9 pct higher on miners, banks, oils

Tue Jul 14, 2009 12:31pm EDT
 
[-] Text [+]
 * Miners in demand; metals prices rally
 * Banks higher on Goldman Sachs results
 * Vodafone and food retailers weigh
 
 By David Brett
 LONDON, July 14 (Reuters) - London's top share index closed
up 0.9 percent on Tuesday, led by miners, banks and oil
producers as impressive corporate data from the United States
outweighed mixed economic figures.
 The FTSE 100 index .FTSE ended 35.55 points higher at
4,237.68, extending Monday's 1.8 percent gains. The index has
risen more than 23 percent since hitting a six-year low in
March, but is still down 4.4 percent for the year.
 Impressive figures from Goldman Sachs (GS.N), Wall Street's
largest surviving bank, and Johnson & Johnson (JNJ.N) offset an
unexpected jump in producer prices in the U.S., which came in at
more than double economists estimates. [ID:nN14306658]
 "Given the recent weakness in markets we have seen, the
second-quarter results season should trigger a little bit of a
mini rally. If we don't rally, then we could see the FTSE in
sub-4,000 territory," said Paul Kavanagh, a partner at Killik &
Co.
 Chip manufacturer Intel (INTC.O) will release its figures
later on Tuesday in the U.S.
 Banks gained positive momentum after Goldman Sachs said its
quarterly earnings surged 33 percent on strong trading results.
 Barclays (BARC.L), HSBC (HSBA.L), Lloyds Banking Group
(LLOY.L) and Royal Bank of Scotland (RBS.L) put on between 1.2
and 2.1 percent.
 Miners were the top sector gainers as investor optimism of
even higher metals prices drove stocks north.
 Fresnillo (FRES.L), Lonmin (LMI.L), Kazakhmys (KAZ.L),
Antofagasta (ANTO.L), Xstrata (XTA.L) and Rio Tinto (RIO.L)
added between 5.1 and 13.3 percent.
 Insurers were also strong. Aviva (AV.L), Friends Provident
(FP.L), Old Mutual (OML.L) and Prudential (PRU.L) rose between
0.9 and 3.5 percent.
 Energy stocks pushed higher, as crude CLc1 stayed above
$60 a barrel. Cairn Energy (CNE.L), BP (BP.L), BG Group (BG.L)
and Tullow Oil (TLW.L) climbed 0.4 to 4.9 percent.
 
 MIXED MESSAGES
 Kavanagh said the focus will be on corporate earnings given
the mixed picture of the wider economic outlook.
 The British Retail Consortium said retail sales rose in June
and house prices in England and Wales fell at their slowest
annual pace in almost two years last month. [ID:nLAG003596]
 However, ministers in Britain took a more cautious tone.
 UK finance minister Alistair Darling said there was still a
lot of uncertainty, while business secretary Peter Mandelson
said the fall in the economy was coming to an end but the
"severity, obviously is not yet behind us".
 
 VODAFONE WEIGHS
 Vodafone (VOD.L) was the biggest single drag on the blue
chips, down 1.9 percent, after a downgrade from UBS to "neutral"
from "buy" and a cut in the price target chilled appetite for
the telecoms giant.
 UBS said in a note that economic pressures, market share
loss and currency effects have combined to put pressure on
earnings estimates at the telecoms operator, and that earnings
will decline 11 percent this year.
 Food retailers were also hit. Tesco (TSCO.L), Wm Morrison
Supermarkets (MRW.L) and J.Sainsbury (SBRY.L) fell 0.3 to 0.9
percent.
 "Sentiment clearly remains key and at least for the time
being the bulls do seem to be pushing in," said David Fineberg,
head of trading at CMC Markets.
 There will be more data on Wednesday for the UK market to
digest. UK unemployment data will be followed by jobless figures
from the euro zone and later the U.S. CPI will keep the economic
fundamentals on the agenda.
 (Editing by Karen Foster)

 

More News

Banks, miners pull FTSE up on recovery hopes
Thursday, 13 Aug 2009 07:28am EDT 
FTSE up 0.4 percent after BoE inflation report
Wednesday, 12 Aug 2009 07:12am EDT 
Weak banks, miners drag down FTSE 1%; defensives up
Tuesday, 11 Aug 2009 12:06pm EDT 
FTSE eases as weak banks offset oil, miner gains
Tuesday, 11 Aug 2009 06:35am EDT 
FTSE closes down 0.2 pct; banks, miners pressured
Monday, 10 Aug 2009 12:04pm EDT 

Featured Broker sponsored link