In London Miners, Banks Lead Gainers

Mayank Mehta
21 Dec, 2009
New York City

UK stocks edged higher after the Confederation of British Industries revised higher its economic and interest rate outlook. Commodities, metals and energy prices inched higher. LSE will merge its dark pool trading platform with Turquoise and take a 60% stake.

[R]7:00 PM London, 2:00 New York – UK stocks edged higher after the Confederation of British Industries revised higher its economic and interest rate outlook. Commodities, metals and energy prices inched higher. LSE will merge its dark pool trading platform with Turquoise and take a 60% stake and £20 million charge.[/R]

UK stocks gained after commodities rallied and the industry association lifted its outlook on the economic growth.

In London FTSE 100 Index closed higher 97.18 or 1.9% to 5,293.99 and the pound closed lower to $1.605.

The Confederation of British Industries revised its economic view for the UK economy to an expansion of 1.2% from the previous estimate of 0.9%. The industry estimated economic contraction of 4.5% in 2009. The benchmark interest rate is expected to increase to 2% by the end of the year from the current 0.5%.

The European Commission lifted its outlook for the European economic expansion to 0.7% in 2010 and 1.5% in the year after.

Stock Movers

Metals and mining stocks advanced. Vedanta Resources increased 2.3% to 2,454 pence and Xstrata Plc increased 3.4% to 1,053.50 pence. Antofagasta Plc increased 0.7% to 911 pence and Anglo American Plc added 2.1% to 2,649 pence.

Hunting Plc increased 7.2% to 543.50 pence after it commented that the company is likely to generate revenues and earnings that are near the upper end of market expectations.

Royal Dutch Shell Plc increased 2.6% to 1,834.50 pence after the Sunday Times reported that the energy giant is looking to sell its Nigerian holdings for $5 billion as the violence continues and the government increases the restriction on foreign companies.

London Stock Exchange decreased 1.6% to 706 pence and it agreed to merge its Baikal dark pool trading platform with Turquoise. LSE will control 60% of the newly merged entity and record £20 million in one-time charge in the current financial year.

The newly merged unit will be retain the name Turquoise and will use the trading technology platform of recently acquired Sri Lankan company MillenniumIT.

Banks in London increased but Irish banks declined. Barclays Plc increased 3.3% to 273 pence and HSBC Holdings Plc added 3.3% to 702.5 pence. Standard Chartered added 3.3% to 1,543 pence.

Allied Irish Bank Plc declined 4.6% to 1.04 euros after Central Bank Governor Patrick Honohan commented that the government may end up taking a majority stake in the largest banks in Ireland.

Tesco Plc added 2.4% to 416 pence and Thomas Cook Group increased 2.4% to 230 pence.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 97 increased, 5 declined and none were unchanged.

Aggreko Plc decliners in the FTSE 100 index with a loss of 1.56% followed by losses in London Stock Exchange Group Plc of 1.39%, in The Sage Group Plc of 0.31%, in The Royal Bank of Scotland Group Plc of 0.27%, and in Fresnillo Plc of 0.13%.

Cairn Energy Plc led gainers in the FTSE 100 index with a rise of 4.43% followed by increase in Prudential Public Limited Company of 4.35%, in Aviva Plc of 4.08%, in Old Mutual Plc of 3.48%, and in HSBC Holdings Plc of 3.38%.

In Paris CAC 40 Index increased 77.62 or 2.05% to close at 3,872.06, in Frankfurt DAX index higher 99.32 or 1.70% to close at 5,930.53. In Zurich trading SMI increased 40.12 or 0.62% to close at 6,504.44.