London close: Stocks hold on to gains

27th May 2011 16:46

Stocks held on to gains going into a long weekend, as Wall Street opened up higher. After a sharp rise in early trading, the Footsie maintained its level around the 5,930-40 mark for the rest of the day, helped by strong showings from the miners and the banks. Just seven stocks finished in the red.Antofagasta was among the best performers as stocks tracked metals prices higher. Copper, gold and silver prices were firmer because of a weak US dollar, as investors looked to 'safe-haven' qualities of precious metals. Blue chip peers Kazakhmys, Lonmin and Randgold Resources saw shares rise.The banking sector was in demand today after positive comments from Citigroup. The US bank upped its rating on European banks to 'overweight', saying that the recent decline in the share prices provides a good entry level and the risk-to-reward ratios are more positive than three months ago. Lloyds and RBS and HSBC were firmly higher.The consumer confidence index for the UK unexpectedly jumped in May, according to GfK, to -21 points, from -31 the month before. According to Nick Moon, managing director at GfK NOP Social Research, "May's figures show the second largest rise ever - only May 1993 was higher, when it improved by 12 points." Sentiment was lifted in the retailing sector as Next, Kingfisher, Marks & Spencer, Kesa Electricals, Debenhams and Dixons Retail were in demand.Water company Severn Trent is up after it said the new regulatory period has started well for the group with planned operational expenditure for the year below the level allowed for in the Final Determination issued by the industry's watchdog, Ofwat. Sales and profits were slightly ahead of expectations at electronics and maintenance products supplier Electrocomponents, on the back of strong sales growth in all geographic regions and online. Nevertheless, it wasn't enough to bolster the share price, as the stock fell into the red. Engineering software firm Aveva Group was helped higher by a kind word from Singer Capital Markets. The broker upgraded its rating on the stock after a strong end to the year and a confident outlook for the current year. Food ingredients group Tate & Lyle fell lower despite managing to offset reduced selling prices for its SPLENDA Sucralose brand to grow sales by 7% in the year ended 31 March, while profits surged. First half sales at soft drinks group Britvic jumped by a quarter after a first-time contribution from its French division, pushing shares higher.A notable mover today was AIM-listed Northern Petroleum, which fell by over a third after it slashed reserve estimates at three of its five gas fields in the Netherlands and issued a profits warning. Following changes to reserve estimates for its Geesbrug, Grolloo and Wijk en Aalburg field, the company now expects to report a loss after tax for the year ended 31st December 2010.---BC