UK Home Prices Rise; Lonmin, Xstrata Up

Trupti Mehta
29 May, 2009
New York City

The familiar sectors were active in stock trading in London. Miners led the gainers after precious metal prices surged. Gold jumped above $975 an ounce and crude oil hovered near $65 a barrel. Home prices in a latest survey showed an increase of 1.2% in May.

[R]6:00 PM London, 1:00 PM New York – The familiar sectors were active in stock trading in London. Miners led the gainers after precious metal prices surged. Gold jumped above $975 an ounce and crude oil hovered near $65 a barrel. Home prices in a latest survey showed an increase of 1.2% in May.[/R]

Stocks in London closed higher on a rise in miners and home builders. Stock investors are increasingly looking for direction in the commodities sector, global economic stimulus in China and the U.S. and a sustained demand for crude oil.

Home prices increased by 1.2% in May after decreasing 0.3% in April. Home prices in UK have been helped by several rate cuts by the Bank of England. The mortgage rates are tied to the short term rates which have declined to near zero.

In London FTSE 100 Index closed higher 30.40 or 0.69% to 4,417.94.

Gainers & Losers

Home builders surged after the release of home price data from the Nationwide Building Society.

Taylor Wimpey surged 9.4% to 32 pence, Persimmon gained 5.3% to 364 pence and Redrow added 3.3% to 195.75 pence.

A sharp rise in precious metal prices lifted stocks of mining companies. Gold price for immediate month delivery increased to $975 an ounce.

Randgold Resources increased 0.3% to £43.97 pence, BHP Billiton increased 3.2% to 1,476 pence, Aquarius Platinum surged 6% to 305 pence, Rio Tinto plc increased 1.6% to 2,800 pence and Talvivaara Company increased 1.2% to 333 pence.

Xstrata Plc increased 5.3% to 684 pence. Lonmin Plc surged 8.3% to 1,428 pence.

ITV plc increased 4.7% to 38.75 pence after the Office of Fair Trading proposed a review of advertising rates charged by broadcasters. The revised ruling may relax restriction on ITV and its ability to charge to advertisers that were put in place at the time of creation of the company through the merger of Granda and Carlton in 2003.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 52 increased, 48 declined and 2 were unchanged.

Fresnillo Plc decliners in the FTSE 100 index with a loss of 4.2% followed by losses in Thomas Cook Group PLC of 3.2%, in Tullow Oil plc of 2.8%, in J Sainsbury PLC of 2.6% and in RSA Insurance Group PLC of 2.3%.

Lonmin Plc led gainers in the FTSE 100 index with a rise of 8.4% followed by increase in Eurasian Natural Resources Corporation PLC of 5.7%, in Xstrata plc of 5.3%, in Anglo American PLC of 5.2%, in Antofagasta plc of 5.1%.

Europe Markets Review

In London FTSE 100 Index closed higher 30.40 or 0.69% to 4,417.94, in Paris CAC 40 Index increased 13.95 or 0.43% to close at 3,277.65 and in Frankfurt DAX index higher 7.94 or 0.16% to close at 4,940.82. In Zurich trading SMI decreased 0.85 or 0.02% to close at 5,349.74.