Miners and defensives pace gains

4th Jul 2016 14:30

(ShareCast News) - Miners were doing best among the main market groups, with some market commentary referencing the boost to commodity prices from heightened expectations for further monetary stimulus from several of the world´s main central banks, while the Federal Reserve could be expected to stay on the sidelines for longer.As of 12:30 BST three-month copper futures were 2.7% higer at $4,927.50 per metric tonne on the LME.Nonetheless, it was Fresnillo that was topping the leaderboard as the Silver Index jumped 5.8% to $20.36/oz..A 1.6% gain overnight in Dubai gold futures to $1,344.70/oz. also gave the likes of Randgold Resources a leg up.Several of the main defensive sectors were also among Monday´s best performers.On a related note, in a research report dated 4 July JP Morgan strategist Mislav Matejka cautioned clients he did not believe the currency had legs and told them to focus on those sectors who would be the main beneficiaries of falling sovereign bond prices."Our key strategy for 2016 remains to 'overweight' defensives. We would use any short term bounces in cyclicals to reduce," he said in a research report sent to clients on 4 July."Regionally, we believe FTSE 100 will remain a surprise outperformer, currency hedged," Matejka said.From a sector standpoint, Matejka said his top picks for the year remained: utilities, real estate excluding the UK, telecoms, healthcare and energy.Real estate investment trusts were the worst performer as Liberum downgraded its ratings on British Land, Land Securities, Intu Properties and Hammerson as it pointed to greater occupier uncertainty in London City offices and retail following the UK's decision to leave the European Union.Acting as a backdrop, the Markit/CIPS UK construction purchasing managers' index fell to 46.0 from 51.2 in May, marking its lowest level in seven years and below the 50.0 threshold that separates contraction from expansion for the first time since April 2013.Economists had been expecting a reading of 50.5.The deterioration was led by a steep decline in residential building and a reduction in commercial work for the first time since May 2013.Data for May on investor flows from the Investment Association revealed that property funds saw a net retail outflow of £360m.Top performing sectors so far todayMining 11,129.80 +2.80%Industrial Metals & Mining 1,431.02 +2.25%Electricity 9,325.28 +1.23%Pharmaceuticals & Biotechnology 13,751.30 +0.19%Tobacco 57,234.23 +0.19%Bottom performing sectors so far todayReal Estate Investment Trusts 2,681.39 -4.13%Industrial Transportation 2,849.66 -3.63%Automobiles & Parts 6,273.03 -2.72%General Retailers 2,380.26 -2.38%