Banks help lift FTSE to 10-week closing high


* Banks mostly higher ahead of G20 meeting commentsBy Jon HopkinsLONDON, Oct 14 (Reuters) - Strength in commodity stocks and banks pulled Britain’s leading shares higher on Friday, with the FTSE 100 index closing above 5,450 for the first time since August 3, with that level having been the top of a trading range for more than two months.The blue-chip index briefly reached 5,501 before easing back from that level, also last seen on August 3.The FTSE 100 closed up 62.98 points, or 1.2 percent, at 5,466.36, rebounding from a 0.7 percent decline in the previous session.It gained 3 percent over the week, and has bounced some 10.5 percent since hitting a low below 5,000 on October 4.”It’s a good end to a positive week, but the FTSE will have to show it can hold above these levels for quite a while before it can kick on,” said Mic Mills, head of trading at ETX Capital.”And given low trading volume still, there really does not seem anything underlying this rally to keep it up.”Volume on Friday was at 70 percent of the 90-day average.Integrated oils was the top-performing blue-chip sector as the price of crude jumped. BG Group was up 2.3 percent, also helped by vague bid rumours.Traders noted revived talk that a Chinese firm could be interested in bidding for BG, a perennial takeover target, possibly in a joint bid with a Middle Eastern buyer.Among the miners , Antofagasta was a good gainer, ahead 3.7 percent, as the copper price bounced higher as benign inflation data from China fanned hopes for improved demand from the world’s biggest metals consumer.Traders viewed a softening in inflation as a sign the Chinese government would be unlikely to tighten monetary policy further.Encouraging U.S. economic data added support, with September retail sales ahead of forecasts, helping drive gains by U.S. blue-chips , up 0.6 percent by London’s close.Glencore International , however, was the heaviest blue-chip faller, down 3 percent, with traders citing talk Goldman Sachs was undertaking a secondary placing of a $175 million convertible bond for the commodities trader.BANKS BUOYEDBanks saw support as a sector, led by Barclays , up 1.6 percent, as investors awaited any news from a summit of G20 finance chiefs and central bank heads in Paris, particularly with regards to the euro zone debt crisis.But part-state-owned Lloyds Banking Group missed out, dropping 2.9 percent after a late turnaround, with traders citing talk of negative weekend press comment.In addition, a downgrade to Spain’s credit rating on Friday highlighted the risk of a much larger European economy than Greece coming under threat.French and German officials are trying to hammer out a crisis resolution plan in time for an EU summit on Oct. 23.”The eradication of one of the biggest risks to another banking crisis and global recession could potentially be achieved this time round, which is getting the equity markets excited,” said Angus Campbell, Head of Sales, Capital Spreads.”However, it’s quite a punchy call to pile into stocks today as there’s every chance the plans to tackle Europe’s sovereign debt crisis may not go far enough.”Among individual stocks, water company Severn Trent fell 1.3 percent, weighed by a downgrade in rating from HSBC to “underweight” from “neutral” on valuation grounds.And Kingfisher fell 1.1 percent as Oriel Securities downgraded its recommendation on Europe’s No.1 home improvements retailer to “reduce” from “hold” on concerns over future growth.DIY retailing peer Home Retail Group was the heaviest FTSE 250 faller, down 5.2 percent, with the firm reporting first-half results next week.

Banks help lift FTSE to 10-week closing high


* Banks mostly higher ahead of G20 meeting commentsBy Jon HopkinsLONDON, Oct 14 (Reuters) - Strength in commodity stocks and banks pulled Britain’s leading shares higher on Friday, with the FTSE 100 index closing above 5,450 for the first time since August 3, with that level having been the top of a trading range for more than two months.The blue-chip index briefly reached 5,501 before easing back from that level, also last seen on August 3.The FTSE 100 closed up 62.98 points, or 1.2 percent, at 5,466.36, rebounding from a 0.7 percent decline in the previous session.It gained 3 percent over the week, and has bounced some 10.5 percent since hitting a low below 5,000 on October 4.”It’s a good end to a positive week, but the FTSE will have to show it can hold above these levels for quite a while before it can kick on,” said Mic Mills, head of trading at ETX Capital.”And given low trading volume still, there really does not seem anything underlying this rally to keep it up.”Volume on Friday was at 70 percent of the 90-day average.Integrated oils was the top-performing blue-chip sector as the price of crude jumped. BG Group was up 2.3 percent, also helped by vague bid rumours.Traders noted revived talk that a Chinese firm could be interested in bidding for BG, a perennial takeover target, possibly in a joint bid with a Middle Eastern buyer.Among the miners , Antofagasta was a good gainer, ahead 3.7 percent, as the copper price bounced higher as benign inflation data from China fanned hopes for improved demand from the world’s biggest metals consumer.Traders viewed a softening in inflation as a sign the Chinese government would be unlikely to tighten monetary policy further.Encouraging U.S. economic data added support, with September retail sales ahead of forecasts, helping drive gains by U.S. blue-chips , up 0.6 percent by London’s close.Glencore International , however, was the heaviest blue-chip faller, down 3 percent, with traders citing talk Goldman Sachs was undertaking a secondary placing of a $175 million convertible bond for the commodities trader.BANKS BUOYEDBanks saw support as a sector, led by Barclays , up 1.6 percent, as investors awaited any news from a summit of G20 finance chiefs and central bank heads in Paris, particularly with regards to the euro zone debt crisis.But part-state-owned Lloyds Banking Group missed out, dropping 2.9 percent after a late turnaround, with traders citing talk of negative weekend press comment.In addition, a downgrade to Spain’s credit rating on Friday highlighted the risk of a much larger European economy than Greece coming under threat.French and German officials are trying to hammer out a crisis resolution plan in time for an EU summit on Oct. 23.”The eradication of one of the biggest risks to another banking crisis and global recession could potentially be achieved this time round, which is getting the equity markets excited,” said Angus Campbell, Head of Sales, Capital Spreads.”However, it’s quite a punchy call to pile into stocks today as there’s every chance the plans to tackle Europe’s sovereign debt crisis may not go far enough.”Among individual stocks, water company Severn Trent fell 1.3 percent, weighed by a downgrade in rating from HSBC to “underweight” from “neutral” on valuation grounds.And Kingfisher fell 1.1 percent as Oriel Securities downgraded its recommendation on Europe’s No.1 home improvements retailer to “reduce” from “hold” on concerns over future growth.DIY retailing peer Home Retail Group was the heaviest FTSE 250 faller, down 5.2 percent, with the firm reporting first-half results next week.