FTSE 100 break above 7,100 for record high
FTSE AIM 100 Index above 4,000 first time since March 2014
Miners lead rally
Bovis Homes in profit warning
Pound falls against the dollar to $1.2227
FTSE 100 shares marked a fresh record high on Wednesday and small-caps scaled their highest in nearly three years, as investors, traders and mining stocks were in a more festive mood than their counterparts on Wall Street.
While US stocks opened with high hopes of hitting fresh record highs by the Nasdaq and Dow Jones Industrial Average, it all went pear-shaped early on in the session, while London shares continued to soldier on.
The blue-chip FTSE 100 ended up 0.5% at 7106 having earlier marked a fresh record high of 7109.37.
End of year is often an optimistic affair for London stocks and 2016 proved no different. Fresnillo (LON:FRES) was the top riser, of 5.2% to 1170p after broker JO Morgan raised its price objective from £1,630 to £1,750 in a report. They currently have a neutral rating on the stock.
Fresnillo and Centamin (LON:CEY) were also in demand as gold prices extended gains thanks to technical reasons.
The mood in the mining sector was positive, after Europe’s Basic Resources STOXX index led sectoral gainers with a rise of 2.5% on the back of firmer metal prices. The index is on track to end the year with a rise of 61%, helped by a recovery in commodity prices, better balance sheets and expectations of fiscal stimulus in the United States.
The second-biggest gainer was Randgold Resources (LON:RRS) up 4.9% to 6120p, then BHP Billiton (LON:BLT) up 4.3% to 1311.5p and Anglo American (LON:AAL) up 3.6% to 1165.5p. Rio Tinto (LON:RIO) was also in the top ten, rising by 3.4% to 3166.5p and Glencore (LON:GLEN) up 2.3% to 276.9p.
In the FTSE 250 mid-caps index Hochschild Mining Plc (LONHOC) was the top riser of 5.5% to 197.2p and Centamin was up 4.8% to 134.4p.
The biggest mid-cap slider was Bovis Homes Group (LON:BVS) down 5.3% to 811p after a profit warning.
On the FTSE 100, the biggest fallers were property investors Land Securities Group (LON:LAND) down 2.9% to 1039p and British Land Company (LON:BLND) down 2.9% to 622.5p.
The FTSE AIM 100 Index broke above 4000 and ended up a hefty percentage gain of 1.3%, or 52 points, at 4050 – its highest since early March 2014.
Meanwhile, the FTSE AIM All-Share Index ended up 1% at 839 – its highest since April 2014.
In aggregate, 38% of stocks gained in London, and 24% dropped.
1305 GMT - FTSE 100 closes in on record territory led by the miners
FTSE 100 goes above 7,100
Miners driving the market higher
Bulk commodities, gold and oil prices firmer
Revival in natural resources sector drags juniors higher
The miners drove the FTSE 100 close to record territory on an otherwise quiet day in the Square Mile.
At 1pm, the index of blue-chip shares was up 35 points at 7,103.13 – less than a point shy of the all-time closing high.
Rising commodity and precious metals prices had the likes of BHP Billiton (LON:BLT) and Fresnillo (LON:FRES) playing catch-up after the Christmas break with rises of 4.2% and 3.9% respectively.
The star of the junior market was also in the natural resources sector as Bellzone Mining (LON:BZM) soared 57% after it secured a new funding deal with its backers.
Graphene NanoChem plc (LON:GRPH) jumped 27% after it unveiled a new contract to use its new drilling fluid in a couple of shale gas wells in China.
British Airways owner International Consolidated Airlines Group (LON:IAG) and EasyJet (LON:EZJ) were grounded in early afternoon trade.
Traders were left to fret that delays to orders from both Airbus and Boeing hinted at a growing malaise in the world of travel amid concerns over the terror threat.
Crude oil prices rose for the fourth day in a row as it passed US$56 a barrel.
Gold, the driving force behind a revival in the likes of Fresnillo, Randgold and Centamin on Wednesday, enjoyed what dealers referred to a sharp technical rebound to US$1,136 an ounce.
10.45am...Footsie on the rise
FTSE 100 up 25 to 7.093
Closes in on new all-time high
Miners lead, Bovis warns over sales
FTSE 100 was heading towards its all time high as traders returned happy from the Christmas break. Miners were the stand-out performers, though Bovis (LON:BVS) eased almost 5% to 815p on a warning it would miss its sales target for 2016.
Among the small caps, miner VAST Resources (LON:VAST) rose 30% after a week of bullish comments pre-Christmas, while a new contract in China for its 'smart' drilling fluid lifted Graphene Nanochem (LON:GRPH) by over 20%.
8.45am ...FTSE 100 gets off to a positive start as miners lead the pack
Traders looked to have filtered back from the Christmas break in slightly better heart than had been predicted.
For the FTSE 100 opened its account 14 points to the good at 7,082.51 having been predicted to drift lower at the open.
That puts the index of blue-chip shares within touching distance of the closing high of 7,103.98 posted last April, while the intraday record also isn’t that far in the distance at 7,129 (set in October).
The miners, down in recent sessions due to a bout of profit-taking, led the Footsie higher with Anglo American (LON:AAL) up almost 5%, followed by BHP Billiton (LON:BLT) and Fresnillo (LON:FRES).
A bout of jitters ahead of the key holiday selling season and delayed reaction to the terror attacks in Berlin and Ankara grounded travel-related stocks.
British Airways owner International Consolidated Airlines Group (LON:IAG) and EasyJet (LON:EZJ) were grounded, while the hotelier InterContinental (LON:IHG) was also on offer.
On AIM, one of the small-cap index’s larger companies was up 3% on the back of what looks like a half decent deal if it comes off.
For boohoo.com PLC (LON:BOO) has lodged a bid for certain assets of Los Angeles-based competitor Nasty Gal, which is currently in Chapter 11 bankruptcy protection.
"Nasty Gal would add a well-established, global brand to the boohoo family but its bid may not result in a transaction if higher or more favourable offers are obtained by Nasty Gal during the auction process," said Russ Mould of investment firm AJ Bell.
6.45am...slow start predicted
The FTSE 100 is set to open the foreshortened trading week in negative territory with little real direction provided by Wall Street or the Asian markets overnight.
The spread betting firms are predicting the index of blue-chip shares will fall 16 points 7,052.17 at the open.
The Italian soap opera that is Monte dei Paschi di Siena is expected to keep a lid on any post-festive euphoria with the costs of bailing out the ailing bank set to rise from a previously-disclosed €5bn to €8bn.
In the US, the Dow Jones posted an 11 point gain on meagre volumes to close on 19,945.04, while in Japan the Nikkei 225 was flat.
The major casualty was Toshiba, which triggered its own temporary suspension by falling more than 20% amid worries about the profitability (or otherwise) of its US nuclear operations.
Back here in the UK, expect a quiet day with scheduled news at a premium.
- Brent crude trading 12 cents lower at US$55.97 a barrel.
- Gold up US$5.60 an ounce at US$1,142.90.
- Pound worth US$1.2289.
Business headlines
- A shock warning from Toshiba that it may have to write down billions of dollars after the purchase of an American nuclear power company went sour has hit its shares – FT & Times.
- Pinterest has doubled the number of advertising campaigns on its online scrapbook this holiday shopping season in the U.S., with retailers including Amazon, Starbucks and Walgreen’s adopting the platform – FT.
- Co-op plans to spend £70mln to open 100 stores across the UK next year, as its larger supermarket rivals shelve growth plans amid retail market jitters – Telegraph.
- Royal Bank of Scotland is braced for the Bank of England to order an independent inquiry into its plans to offload Williams & Glyn, the 314-branch network the state-backed lender has been struggling to divest for more than seven years – Telegraph.
- The company secretary to Arcadia Group and a close adviser of Sir Philip Green has resigned after more than two decades working at the group behind the Topshop brand. Adam Goldman is leaving to work in his own personal business – Times.
- Royal Bank of Scotland could nearly halve the bonus it pays its boss as the state-backed lender looks to clamp down even further on executive pay – Times.
- A majority of managers in the UK believe Brexit-related uncertainty will hold back economic growth next year and almost half think leaving the UK will be a drag in the long term – Guardian.
- House prices will rise by between 1% and 4% in 2017, according to Halifax’s annual forecast, marking a sharp deceleration from 2016, as it raised the prospect of falling prices in London- Guardian.