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Stronger insurers, miners push FTSE to 1-month high
October 18, 2013 / 3:03 PM / 4 years ago

Stronger insurers, miners push FTSE to 1-month high

(Updates with closing prices in para 2, 6, 7)

* FTSE 100 index rises 0.7 percent

* Prudential boosted by strong results from Asian rival

* Seventh session of FTSE gains follows record highs on Wall St

By Toni Vorobyova

LONDON, Oct 18 (Reuters) - Britain’s top share index hit a one-month high on Friday, with miners cheered by news of improving economic growth in China and with insurer Prudential boosted by buoyant business at an Asia-focused peer.

The FTSE 100 closed up 46.42 points or 0.7 percent at 6,622.58, its seventh session of gains. Market sentiment was bolstered by record highs on Wall Street.

Investors regained appetite for risky assets following a deal on the U.S. debt ceiling which averted the possibility of a sovereign default in coming weeks.

The lifting for now of U.S. fiscal uncertainty enabled the market to refocus on the outlooks of individual companies.

“Now that the U.S. debt ceiling hurdle has been surpassed, we’ve got continued buying into equities looking forward to a year end rally,” said Jordan Hiscott, trader at Gekko Global Markets. “On the back of the Chinese GDP, there is interest in the mining sector, people are building on existing longs.”

Fresnillo led the miners’ gains, up 3.8 percent after data from top metals consumer China showed the world’s second-largest economy grew 7.8 percent in the third quarter, its quickest pace this year..

The biggest single-stock boost to the FTSE though came from Prudential, which rose 4.1 percent, cheered by strong business growth at Asia-focused AIA Group.

“We are very keen on (Prudential) ... We were always very clear that at some stage the story in Asia would actually take off,” said Ray at Wilson King.

“They have sunk a lot of money and a huge amount of time into this business, and it’s a very, very considerable payback for the shareholders and for the company as a result of their investment in different parts of the world.”

The insurance sector also gained after Sharon Bowles, the chairwoman of the European Parliament’s economic affairs committee, told Reuters late on Thursday that a deal on how insurers will hold enough capital to keep policyholders safe will severely water down the version sought by industry regulators.

On the downside, William Hill fell 3.2 percent after JP Morgan downgraded the bookmaker to ‘underweight’.

“WMH’s significant scale advantage in UK online is attractive, and over time we still see scope for re-rating as it narrows the quality gap to PWL (Paddy Power ). However, we think industry headwinds are likely to outweigh the longer-term positives over the next 12 months,” the analysts wrote. (Editing by Hugh Lawson)

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