LONDON April 27 (Reuters) - Mining and banking stocks
rallied in London on Friday, enabling the blue chip index to
recover from an early slide but trade was very thin ahead of the
weekend and energy shares lost ground on profit taking.
At 0837 GMT, the FTSE 100 index was up 9.68 points,
or 0.2 percent at 5,758.40, reversing an opening drop to a low
of 5,707.96 and extending gains to a fourth day.
Trading volumes were 12 percent of the 90-day daily average.
Nearing the end of the month, the UK blue-chip index is
almost unchanged from its April opening level of 5,768 after a
topsy-turvey performance, with technical analysis indicating
further gains were possible.
“After spending most of April rangebound, the FTSE appears
to be ready to show some strength, but this will only occur if
it can regain then establish support above the key retracement
zone at 5,782.75 to 5,831.45,” said James A. Hyerczyk, analyst
at Autochartist.
“The fact that it has been trading inside of a triangular
chart pattern for close to 20 market days confirms that it has
been “non-trending” ... If the market rallies under these
conditions, then this would be a strong sign that sentiment has
shifted to the upside, Hyerczyk added.
Investors appeared to shrug off a cut in Spain's credit
rating by Standard & Poor's late on Thursday but concerns about
the euro zone debt crisis continue to affect the market.
“Although not totally unexpected, it will be a poignant
reminder that the euro zone debt crisis is still far from over,”
said Jonathan Sudaria, trader at Capital Spreads.
Mining shares pushed the benchmark index higher
after copper prices recovered in London, reversing falls
in Asian trade.
Banks also rallied, led by Barclays.
The lender jumped 2.9 percent, adding to a 0.9 percent gain on
Thursday when it posted above-forecast first-quarter earnings.
The bank was due to hold its annual general meeting on
Friday and Chairman Bob Diamond was expected to take the
unprecedented step of apologising to shareholders over the
bank's mishandling of the pay of top executives, newspapers
said.
Among other financials, Man Group was the top blue
chip performer, up 3.2 percent after the Financial Times said
leading shareholders in the hedge fund manager have warned its
chief executive, Peter Clarke, that he must revive the company's
fortunes in the coming months or face calls to step down.
UPGRADES HELP
JPMorgan upgrades helped Irish building materials group CRH
and real estate investment trust British Land.
CRH gained 2.9 percent as JP Morgan upgraded its rating to
“overweight from “underweight”, citing valuations combined with
upgrades after recent full-year earnings.
British Land shares rose 2.5 percent after JPMorgan upgraded
it to “overweight” from “neutral”.
Shares of integrated oil companies provided the
main drag on the blue-chip index, reversing Thursday's strong
gains led by Royal Dutch Shell. Shell fell 0.4 percent
after gaining 3.2 percent on Thursday when the company reported
above-forecast earnings.
Underlying sentiment was also restrained by disappointing UK
consumer confidence data.
Worries about prospects for the coming year kept Britons'
economic morale in the doldrums in April, with the headline
consumer confidence index in a survey conducted by pollster GfK
NOP staying at -31 in April, confounding economists' forecasts
for a slight improvement to -30.
No other key British economic data will be released on
Friday, so investors will focus on U.S. first-quarter GDP due at
1230 GMT, and the final reading of the April Reuters/University
of Michigan consumer sentiment survey scheduled for 1355 GMT. - Reuters