Mining and leisure stocks boost Footsie

The London market continued its good run today as mining and leisure stocks lifted the FTSE 100 Index to a fresh four-and-a-half year high.

Boosted by the Nikkei in Japan overnight and early gains on Wall Street today, the Footsie built on recent gains to stand up 15.5 points at 5638.3.

It could have been even better as the top flight hit 5647.2 this morning, but despite gains ebbing away in the afternoon, the FTSE 100 Index looks set to end 2005 clear of the 5,600 mark tomorrow – levels that have not been recorded since the summer of 2001.

While today’s improvement was achieved amid thin trading volumes, analysts said it reflected hopes the top flight index could exceed 6,000 next year.

Miners dominated the risers board as demand for commodities such as gold and copper showed no sign of ending – in turn adding more than four points to the value of the Footsie today.

Xstrata led the pack with a gain of 19p to 1359p, while BHP Billiton was 9p stronger at 944p and Rio Tinto lifted 17p to 2657p. Kazakh copper miner Kazakhmys was also in good shape, up 10p to 770p.

Dean Castles, trader at CMC Markets, said two days of steep gains after the Christmas break had led many clients to book profits.

However, he added: “The willingness of some to hold long positions is also evident as traders feel the boom in the Chinese economy will last well into 2006 so further growth in the sector is likely.”

Among the other highlights of a quiet session, Marks & Spencer added 1% or 5.75p to reach a new seven-year high of 510p.

That was after comments from Karen Millen-to-Oasis chain Mosaic Fashions fuelled expectations of a stronger-than-expected Christmas trading season.

Housebuilders were on the front foot after losing ground yesterday. Persimmon led the recovery in the top flight, up 17p at 1270p, while second tier rivals Bovis Homes and Taylor Woodrow were ahead 20p and 9p to 796p and 381p respectively.

Elsewhere, investors were buying into Hilton Group ahead of the completion of the £3.3 billion deal to sell its hotels to US-based cousin Hilton Hotel Corporation. The deal was confirmed just minutes before the market closed and shares finished up 4.25p at 368.75p, while the prospect of further consolidation in the sector caused rival InterContinental Hotels to improve 7p to 842.5p, a gain of around 1%.

BAE Systems was another stock on the up as investors continued to buy into the company following last week’s announcement that Saudi Arabia would buy up to 72 Eurofighter Typhoons to modernise its air force. Shares were at a three-year high before Christmas but added another 1% or 5p to reach 388p today.

The days biggest risers were Shire up 11p to 753p, BOC up 17p to 1199p, Xstrata up 19p to 1359p and Sage 3.5p ahead at 259.5p.

The heaviest blue chip fallers were PartyGaming down 2.75p to 133.25p, United Utilities off 10p to 672p, Alliance UniChem down 8.5p to 798.5p and Cadbury Schweppes down 4p to 550.5p.


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