June 3, 2010 / 11:13 AM / 9 years ago

FTSE hits 2-wk high, aided by Obama's jobs remark

* FTSE 100 up 1.7 percent

* Energy stocks climb; BP rallies after 32 pct fall

* Kingfisher rises on first-quarter results

By David Brett

LONDON, June 3 (Reuters) - Britain’s top shares hit a two-week high on Thursday after upbeat comments from U.S. President Barack Obama on upcoming jobs data lifted investor sentiment, with miners and energy stocks leading the gainers.

By 1037 GMT, the FTSE 100 .FTSE was up 86.23 points, or 1.7 percent, at 5,237.55, after rising as much as 5,262.50 to hit a two-week high and bouncing back after three straight sessions of falls.

Obama said on Wednesday he believed that the May employment report, due on Friday, would show strong growth in U.S. payrolls. [ID:nN02175839]

“President Obama helped trigger investors into buying equities on the hope that tomorrow’s jobs data will in fact be strong,” Joshua Raymond, market strategist at City Index said.

“We have seen investors coming in to pick up energy firms and miners after weakness this week.”

Energy stocks led the charge as investors took the opportunity to pick up bargains such as BP (BP.L), up 2.8 percent. The oil major has shed over 30 percent since the Gulf of Mexico oil spill began over five-weeks ago. [ID:nN03207991]

Crude CLc1 added 0.7 percent, while BG Group BG.L and Royal Dutch Shell (RDSa.L) gained 2.1 and 1.6 percent respectively.

Miners found favour, rallying in the wake of Wednesday’s declines in tandem with a rebound in metals prices.

Xstrata XTA.L, up 2.9 percent, threatened to scrap $5.4 billion in Australian coal and copper projects, blaming a new mining tax and taking the value of new developments put on hold to above $20 billion in just a month. [ID:nSGE65201K]

Johnson Matthey (JMAT.L), the world’s largest supplier of catalytic converters, rose 1.9 percent as it said it expects to make good progress in the first half of 2010/11 after posting a 5 percent dip in annual underlying pretax profit.

Banks were also some of the top performers, with Lloyds Banking Group (LLOY.L) up 2.3 percent.


Kingfisher (KGF.L) climbed 2.8 percent after the home improvements retailer posted a 15 percent rise in first-quarter profit as cost savings and reduced losses in China offset a fall in underlying sales due to poor spring weather.

Advertising firm WPP (WPP.L) posted solid gains, adding 3.7 percent, bolstered by a UBS upgrade to “buy”.

While UK corporate growth continues to impress on the upside, wider macroeconomic fragility remains.

Growth in Britain’s services sector held broadly steady in May but worries about an impending public spending squeeze took a toll on new business growth and hiring. [ID:nSLA2HE66M]

U.S. stocks, which rallied more than 2 percent on Wednesday after surprisingly strong U.S. housing data and Obama’s comments, looked set for another bullish session as investors await more economic data from the world’s biggest economy.

Futures for the S&P 500 SPc1 and Dow Jones DJc1 added 0.6 percent ahead of the latest weekly jobless claims. (Editing by Jon Loades-Carter)

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