Blogs and advice from Industry leading Specialists
Valuable Opinions, Comments & Gossip
Financial related News & Articles relating to Spain
Latest News, Stories
& Hot Topics
Various Tools & Widgets to help with your financial needs
Tools & Widgets to
help with finances
Polls, Surveys and Opinions featured throughout Tumbit
Featured Polls, Surveys & Stats
Discussions, Advice & Topical Chat
Discussions, Advice & Topical Chat

Commodity stocks add fuel to FTSE rally

Source: Reuters - Wed 23rd Sep 2009

The top share index rose 0.6 percent early on Wednesday as commodity stocks gained on optimism about prospects for the global economy ahead of a rate decision from the U.S. Federal Reserve due later.

By 9:00 a.m. the FTSE 100 was up 32.16 points at 5,174.76, after it closed up 0.3 percent on Tuesday having reached a fresh 2009 intraday peak in the session at 5,189.88.

A sense the global economy was returning to growth has improved the demand outlook for miners, while a weaker dollar .DXY also helps support metal prices.

Rio Tinto, Xstrata, Eurasian Natural Resources, Anglo American, Kazakhmys and Fresnillo added 1.2-2.6 percent.

The index has gained 49.5 percent since touching a six-year trough in March, and many analysts think investors will be reluctant to push the market much higher.

"People are concerned that the market has been pushed too far too fast, and it will be hard to push it much further, you've got to ask where the growth is going to come from" said Justin Urquhart Stewart, investment director at Seven Investment Management.

But, for now, investors remain bullish and energy firms were also bolstered by investors' healthy risk appetite.

BP, Royal Dutch Shell, BG Group, Tullow Oil and Cairn Energy added 0.2-2 percent.

LIBERTY SLIDES

Shopping mall owner Liberty International fell 5.3 percent, the top blue-chip laggard, as it placed 56.1 million shares to raise new funds to restart investment plans mothballed at the height of the financial crisis a year ago.

Other property companies were also on the back foot as the Liberty move highlighted funding concerns in the sector. Hammerson, British Land and Land Securities fell 0.7-1.4 percent.

Britain has probably come out of recession but the pace of recovery in 2010 will be slow, with tight credit and weak domestic demand posing obstacles to an upturn, the Confederation of British Industry said on Wednesday.

The business group said it expected the economy to have grown 0.3 percent between July and September, and forecast an expansion of 0.4 percent for the fourth quarter - an improvement from its prognosis in June that growth would not return until early next year.

Banks were beneficiaries. HSBC, Standard Chartered, and Lloyds Banking Group rose 0.6-1.4 percent.

Investors will eye the interest rate and quantitative easing vote outcome from this month's Bank of England Monetary Policy Committee meeting, due at 0830 GMT and with a 9-0 decision to maintain the status quo expected to be confirmed.

After the London close, investor attention will turn to the outcome of the latest two-day Federal Reserve Open Market Committee meeting, although no change is expected to U.S. monetary policy.

Ahead of that, investors will watch the latest U.S. mortgage and refinancing indexes to get further evidence on the state of the world's largest economy.

Four FTSE 100 companies traded ex-dividend on Wednesday, with Aviva, Centrica, G4S, and Petrofac knocking 1.94 points off the blue chip index.

Comment on this Story

 
Be the first to comment on this Story !!

Recommended Items