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FTSE 100 seen higher after US stocks shake off home sales update, Asian markets rally

24th Dec 2009, 7:51 am FTSE 100 seen higher after US stocks shake off home sales update, Asian markets rally

Overview: the FTSE 100 is projected to extend its winning streak after another day of gains on Wall Street despite some unexpectedly disappointing data. The markets had to absorb an update from the US Commerce Department, which said that new home sales unexpectedly fell 11.3% in November just a day after the National Association of Retailers reported a 7.4% increase in existing home sales for the month following a 10% improvement in October.

The Dow Jones Industrial Average barely held on to the opening level, ending the day with a marginal gain. The broader S&P 500 index added 0.2% and the technology heavy NASDAQ composite rallied d0.75%.

The UK’s blue chip index finished with a 0.8% gain on Wednesday as the leaderboard was stacked with miners, which were boosted by higher metal prices. ENRC (LSE: ENRC) was in the lead, climbing 3.8% with gold producer Randgold Resources (LSE: RRS) and British American Tobacco (LSE: BATS) also making it to the top three with gains of 3.7% and 3.1% respectively. Investment company Alliance Trust (LSE: ATST) advanced 2.5% to become the only other non-mining stock to make it to the leaderboard.

Oil and gas company Cairn Energy (LSE: CNE) was the heaviest faller with a 4.2% loss, while telecommunications company BT Group (LSE: BT), which was trading ex-dividend, followed with a 3% retreat. Other notable fallers included bailed out bank RBS (LSE: RBS) and United Utilities (LSE: UU), which shed more than 1.5% as well as commercial property company Liberty International (LSE: LLI), power generation company International Power (LSE: IPR), tour operator TUI Travel (LSE: TT), insurer Aviva (LSE: AV) and cruise operator Carnival Corporation (LSE: CCL), which all lost more than 1%.

Asian markets were bullish today. Hong Kong’s Hang Seng added 0.9%, Japan’s Nikkei 225 rallied 1.5% to hit three-month highs, Australia’s S&P/ASX 200 was up 1.1%, China’s Shanghai composite index advanced 1.9% and South Korea’s KOSPI rose 1.1%.

Commodities

Oil prices rose yesterday as February Brent Crude improved to US$76.04/barrel, while US light, sweet crude reached US$77.34/barrel.

Precious metals also advanced. Gold climbed to US$1,103/oz, while silver and platinum reached US$17.32/oz and US$1,452/oz respectively.

Base metals inched higher. Copper and nickel rose to US$3.20/lb and US$8.43/lb, while zinc improved to US$1.13/lb.

London markets will close at 12:30 today.

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