London close: Footsie´s bounce extended for a second day

26th Jun 2013 16:29

Stocks closed higher for a second day as China moved to provide liquidity assistance to its battered interbank lending maket and a member of the US Federal Reserve - Narayana Kocherlakota - described markets´ reaction to the central bank´s last policy stamtement as overdone. Back in the UK all eyes were on the Chancellor´s Spending Review for fiscal year 2015. Osborne outlined how he intends to allocate cuts worth 2.7% of his budget between departments. For its part, in its twice-annual Financial Stability report the Bank of England indicated that banks could be vulnerable to a sharp rise in interest rates. Also worth noting, in a speech delivered in London David Miles, an external member of the Monetary Policy Committee (MPC), argued that: "I do not think we should be in any hurry in the UK to move the monetary policy dials back to more normal settings (...) Indeed, it might well be right for the next move in the UK to push them even further to give more support to demand." Acting as a backdrop, analysts at Credit Suisse commented that they would not be surprised if Chinese gross domestic product (GDP) trend-growth moves towards 6%, although they do not believe that it will fall below that pace. In parallel, and following this afternoon´s weaker-than-expected GDP report Stateside, economists at Barclays were writing to clients that: "We look for consumption growth to slow somewhat further in the second quarter and our second quarter GDP tracking stands at 1.8%, implying a sub-2.0% first half of 2013." They added that to achieve the FOMC's current growth forecast for the year as a whole would take a 'significant acceleration' in the second half, 'something we judge very unlikely' they added. Gains in the financial sector were offsetting falls in the mining sector on Wednesday as bargain hunters stepped in following recent falls. Aberdeen Asset Management, Schroders, Resolution and Prudential, four stocks that have been hit hard by market volatility over the last month, were among the top risers today as sentiment picked up.FTSE 100: Aberdeen gains as bargain-hunters step inShares of Aberdeen Asset Management jumped after HSBC lifted the investment firm to overweight from neutral.Insurance, savings and investment group Legal & General rose on plans to purchase UK annuity buy-out firm Lucida for £151m after identifying retirement solutions as one of its "five key themes for growth".Chemicals group Croda was also a high riser after UBS upgraded its rating on the stock from 'sell' to 'neutral' as part of a more upbeat stance on the sector. The broker said that softer comparatives due in the second half for chemicals stocks, combined with recent falls, creates a more attractive entry point.Leading the downside was the mining sector, as metal prices -particulalry those for precious metals - tumbled across the board, owing to a stronger dollar, the increased likelihood that the Federal Reserve will soon 'taper' stimulus if economic data continues to improve and - of course- the weaker outlook for China. Both gold and silver prices were trading at multiyear lows today.Antofagasta, Anglo American, Fresnillo, Randgold Resources, ENRC and Vedanta all registered steep losses.A number of heavyweight stocks traded lower after going ex-dividend on Wednesday, including Next, Tate & Lyle and Compass.Shares of Direct Line Insurance Group climbed 4% after announcing plans to reduce costs by £130m and cut about 2,000 jobs. FTSE 250: Afren rockets after exploration results pay offAfren's shares surged as the UK oil explorer said it discovered a better-than-expected oil section at an exploration well offshore Nigeria. Interdealer broker ICAP was a heavy faller after going ex-dividend.Hochschild Mining and Polymetal retreated as miners took a hit from falling commodity prices including gold, silver and copper.FTSE 100 - RisersAberdeen Asset Management (ADN) 378.30p +4.76%International Consolidated Airlines Group SA (CDI) (IAG) 264.20p +3.24%Croda International (CRDA) 2,429.00p +3.14%ITV (ITV) 137.50p +2.92%Resolution Ltd. (RSL) 278.80p +2.76%Prudential (PRU) 1,059.00p +2.72%easyJet (EZJ) 1,279.00p +2.48%Wolseley (WOS) 3,028.00p +2.47%Unilever (ULVR) 2,591.00p +2.45%Land Securities Group (LAND) 876.00p +2.40%FTSE 100 - FallersFresnillo (FRES) 866.50p -3.56%Anglo American (AAL) 1,256.00p -3.31%Randgold Resources Ltd. (RRS) 3,972.00p -3.05%Antofagasta (ANTO) 801.50p -2.14%Vedanta Resources (VED) 1,028.00p -1.72%Tate & Lyle (TATE) 801.50p -1.48%Intertek Group (ITRK) 2,943.00p -1.18%Petrofac Ltd. (PFC) 1,205.00p -1.15%Melrose Industries (MRO) 242.00p -1.10%Eurasian Natural Resources Corp. (ENRC) 211.70p -1.07%FTSE 250 - RisersKazakhmys (KAZ) 262.40p +7.37%Afren (AFR) 130.60p +7.31%TalkTalk Telecom Group (TALK) 231.90p +5.70%Thomas Cook Group (TCG) 121.80p +5.18%Dixons Retail (DXNS) 41.67p +5.04%Barratt Developments (BDEV) 307.40p +4.63%F&C Asset Management (FCAM) 95.20p +4.62%National Express Group (NEX) 223.70p +4.48%Computacenter (CCC) 447.20p +4.36%Taylor Wimpey (TW.) 94.95p +4.34%FTSE 250 - FallersICAP (IAP) 353.60p -8.58%NMC Health (NMC) 267.70p -8.32%Hochschild Mining (HOC) 164.80p -6.47%Polymetal International (POLY) 464.00p -5.69%African Barrick Gold (ABG) 103.80p -5.46%Evraz (EVR) 100.20p -4.66%Ferrexpo (FXPO) 134.70p -3.92%KCOM Group (KCOM) 81.00p -3.69%IP Group (IPO) 131.00p -3.68%Crest Nicholson Holdings (CRST) 312.00p -3.38%FTSE TechMARK - RisersTriad Group (TRD) 8.00p +6.67%Torotrak (TRK) 28.00p +5.66%Skyepharma (SKP) 63.00p +4.13%Optos (OPTS) 117.00p +4.00%XP Power Ltd. (DI) (XPP) 1,229.00p +2.42%CML Microsystems (CML) 470.00p +1.62%Sepura (SEPU) 118.50p +0.85%Emblaze Ltd. (BLZ) 50.00p +0.50%Innovation Group (TIG) 28.00p 0.00%Parity Group (PTY) 28.75p 0.00%FTSE TechMARK - FallersKofax (KFX) 320.00p -3.03%SDL (SDL) 275.00p -1.87%BATM Advanced Communications Ltd. (BVC) 15.75p -1.56%RM (RM.) 65.00p -1.52%Ricardo (RCDO) 381.50p -1.42%Microgen (MCGN) 143.50p -1.37%Vectura Group (VEC) 81.00p -1.22%Antisoma (ASM) 1.64p -0.61%Phoenix IT Group (PNX) 159.75p -0.47%Vislink (VLK) 31.38p -0.40%AB