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FTSE records another weekly gain, led by commodities

Published 08/04/2016, 16:56
© Reuters. People walk through the lobby of the London Stock Exchange in London
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By Kit Rees and Alistair Smout

LONDON (Reuters) - Britain's top share index posted another weekly rise on Friday, helped by buoyant commodity stocks and continuing a run that has seen it outperform European indexes.

The FTSE 100 (FTSE) was up 67.52 points, or 1.1 percent, at 6,204.41 points at its close, up 1 percent for the week.

Mining shares (FTNMX1770) rose 3.8 percent. Anglo American (L:AAL), BHP Billiton (L:BLT), Rio Tinto (L:RIO), Glencore (L:GLEN) and Antofagasta (L:ANTO) gained 1.6 to 8.1 percent.

Energy shares contributed around 19 points to gains. BP (L:BP) and Shell (L:RDSa) added the most points to the index after Brent crude rose above $40 dollars a barrel.

Some analysts still weren't convinced risk appetite had increased, though.

"I think there is definitely an element of short-covering to some of the upside moves that we're seeing at the moment, and it isn't necessarily manifesting (in) any real risk-on sentiment," Brenda Kelly, head analyst at London Capital Group, said.

Retailer Marks and Spencer (L:MKS) also rose, extending a rally from Thursday when its results beat forecasts, after Canaccord Genuity upgraded its rating on the stock to "buy" from "speculative buy". The stock's gains for the week reached 9.1 percent, the biggest weekly gain since November 2014.

The FTSE 100's heavy weighting in commodities has helped it to outperform other European stocks in recent weeks and to rise for the third week in the past four. The FTSEurofirst 300 (FTEU3) has posted four straight weeks of losses.

Experian (L:EXPN) was down 1.3 percent, leading declines, after HSBC cut the credit data company to "reduce" from "buy", citing structural risks in Brazil

"Brazil’s largest commercial banks ... are working to set up a Positive credit bureau that will compete with Experian," analysts at HSBC said in a note. "We believe such a market development poses a multiple de-rating threat."

© Reuters. People walk through the lobby of the London Stock Exchange in London

Asset manager Schroders (L:SDR) dropped 1 percent after Exane BNP Paribas (PA:BNPP) cut its rating on the stock to "neutral", citing the company's weak flow and fund performance momentum.

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