FTSE inches higher as miners rally

LONDON (Reuters) - UK shares gained on Wednesday, helped by a rally among mining firms which tracked commodities prices higher, though volumes remained thin in the final trading days of the year.

A red London bus passes the Stock Exchange in London, Britain, February 9, 2011. REUTERS/Luke MacGregor/File Photo

The blue chip FTSE 100 index .FTSE was up 0.5 percent at 7,100.55 points by 1211 GMT, reaching its highest level since October.

Mining stocks .FTNMX1770 were the biggest gainers, up 3.5 percent and helped by a firmer oil price and a rally in copper, with which mining shares tend to be closely correlated. [MET/L]

BHP Billiton BLT.L, Fresnillo FRES.L, Rio Tinto RIO.L, Anglo American AAL.L and Glencore GLEN.L were all up between 3.4 to 4.3 percent.

The British mining sector has rallied more than 100 percent in 2016, but has pulled back slightly after reaching a year-high earlier in December.

“Some of the other metals are actually showing negative for the day, but the fact that they look to have bottomed out in the run-in to Christmas and have held firm perhaps yesterday as well is a positive,” Mike van Dulken, head of research at Accendo Markets, said.

“We were in a downtrend that started end of November, so if we can call the end to that, that will be good for (the miners).”

Among the top fallers, airlines International Consolidated Airlines ICAG.L and easyJet EZJ.L lagged, down 2.3 percent and 1.5 percent respectively, on worries sparked by news that French peer Airbus AIR.PA postponed deliveries of 12 A380 planes to Emirates Airline.

While the midcap FTSE 250 index .FTMC also outperformed, also 0.5 percent higher, a 4.8 percent fall in Bovis Homes BVS.L pulled down shares in property stocks after the housebuilder issued a profit warning.

Sector peers Crest Nicholson CRST.L and Berkeley Group BKGH.L dropped 2.5 percent and 1.3 percent respectively.

Reporting by Kit Rees; Editing by Raissa Kasolowsky