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FTSE reaches five-month high as commodity shares gain

Published 13/02/2015, 13:00
© Reuters. A man smokes a cigarette outside The London Stock Exchange
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By Atul Prakash and Sudip Kar-Gupta

LONDON (Reuters) - Britain's top share index advanced to a five-month high on Friday, trading less than 2 percent below its record peak, boosted by commodity stocks that benefited from a rise in copper and oil prices.

The blue-chip FTSE 100 index was up 0.5 percent at 6,861.07 points by 1210 GMT after climbing to 6,887.57, the highest since September last year. The index set a record high of 6,950.60 in late 1999.

The UK mining index surged 3.2 percent and the oil and gas index rose 1.6 percent after copper hit a three-week high and oil rose above $60 a barrel for the first time this year on signs that deeper industry spending cuts may curb excess supply.

Oil stocks BP, Tullow Oil and Royal Dutch Shell rose by between 1.1 percent and 4 percent, while miners Rio Tinto, BHP Billiton and Anglo American were 1.7 percent to 3.2 percent higher.

"The dual push from these commodities, alongside a clearing of clouds over Europe, looks set to give the FTSE a better close to the week than it could have hoped for," Spreadex financial analyst Connor Campbell said.

Traders said expectations that Greece could strike a deal with its international creditors were also helping the FTSE.

Greek shares rose 4.6 percent and the country's banking stocks jumped 10 percent, extending their recent rebound from a 75 percent slump since last March, with investors eyeing a meeting on Monday that could see Athens reach a deal with its creditors.

"Equity markets have made progress on continued optimism of a Greek bailout deal, further supported by agreement on a ceasefire in Ukraine," Mike van Dulken, head of research at Accendo Markets, said.

"No signs of market superstitions on this Friday 13th, or risk-off into what could be an important geopolitical weekend."

Ukraine and Russian-backed rebels fought fiercely for control of a strategic railway junction on Friday despite a new peace deal brokered by Germany and France. A ceasefire is due to come into effect from Sunday.

© Reuters. A man smokes a cigarette outside The London Stock Exchange

Among other movers, pharmaceuticals company GlaxoSmithKline rose 4.2 percent after investment bank UBS raised its rating on the stock to "buy" from "sell".

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