London’s top share index made modest gains yesterday, proving more cautious than other world markets even as the FTSE 250 hit an all-time high.
Europe’s markets moved higher in the expectation of some form of a deal in the US to avoid the “fiscal cliff” of automatic tax hikes and spending cuts, but while Germany’s DAX pushed to its highest levels since 2008, the Footsie was up a modest 23.8 points at 5,935.9.
Toby Morris, senior sales trader at CMC Markets, said: “The FTSE 100 has once again underperformed, finding progress above its recent highs somewhat problematic.”
The mining sector led the gains, with Rio Tinto and Vedanta ahead after China set a preliminary growth target of 7.5 per cent for next year. Both firms added more than 2.5 per cent, at 3,568p and 1,143p respectively. Kazakhmys on the other hand was lower after being on the wrong end of a broker downgrade from Deutsche Bank. It shed 5.5 at 777p.
Aggreko recovered slightly from Monday’s mauling as brokers offered their thoughts on its latest profits warning. Its shares added more than 2 per cent to 1,704p, with Morgan Stanley pointing out that the Glasgow-based firm’s new price-to-earnings ratio had dropped despite the lower profit guidance because the shares had plunged by a fifth.
In the second tier, miner New World Resources jumped 10 per cent to 290p after the International Energy Agency said that coal is rapidly surpassing oil as the world’s top energy source.
But oil firms were not daunted, with Edinburgh-based Cairn Energy adding 4.8p at 263.8p on the back of a broker upgrade from UBS, which moved its recommendation on the Scottish stock to “buy” from “neutral”.
NEW YORK: Wall Street rallied last night, capping the Standard & Poor’s 500 Index’s best two-day run in a month, on confidence that a deal would be struck in Washington to avoid spending cuts and tax hikes that could hurt the economy.
The Dow Jones industrial average closed up 115.57 points, or 0.87 per cent, at 13,350.96 while the SW&P 500 was up 16.43 points, or 1.15 per cent, to finish at 1,446.79. The Nasdaq Composite Index ended up 43.93 points, or 1.46 per cent, at 3,054.53.