Reply #35: FTSE buoyed by trading updates; miners, financials up [View All]

[Ghost Dog]

LONDON, July 30 (Reuters) - Britain's leading share index gained over 1 percent on Wednesday, buoyed by positive sentiment from U.S. and Asian markets and as mining and financials rose among a flurry of trading updates, while retailer Next fell.

At 1028 GMT the FTSE 100 .FTSE 73.2 points, or 1.4 percent higher at 5,392.4 after ticking up 0.1 percent on Tuesday to halt a three-session losing run.

Mining shares were among the leading performers after Xstrata (XTA.L: Quote, Profile, Research, Stock Buzz) said it expected a "significantly" stronger second-half performance across its portfolio after posting a 1.1 percent fall in first-half mined copper output and a 6.1 percent fall in mined nickel production.

Xstrata added 3.1 percent while BHP Billiton (BLT.L: Quote, Profile, Research, Stock Buzz), Rio Tinto (RIO.L: Quote, Profile, Research, Stock Buzz), Anglo American (AAL.L: Quote, Profile, Research, Stock Buzz), Lonmin (LMI.L: Quote, Profile, Research, Stock Buzz) Vedanta Resources (VED.L: Quote, Profile, Research, Stock Buzz) and Eurasian Natural Resources (ENRC.L: Quote, Profile, Research, Stock Buzz) gained 2.4-6.1 percent.

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"It's more like relief at the moment," said Justin Urquhart Stewart, director at Seven Investment Management. "We just reached the clearing in the woods, but it looks like a very thick forest on the other side."

Banks were among the standout gainers, lifted by a rise in U.S. financials overnight. Barclays (BARC.L: Quote, Profile, Research, Stock Buzz), Royal Bank of Scotland (RBS.L: Quote, Profile, Research, Stock Buzz), HSBC (HSBA.L: Quote, Profile, Research, Stock Buzz), HBOS (HBOS.L: Quote, Profile, Research, Stock Buzz) and Standard Chartered (STAN.L: Quote, Profile, Research, Stock Buzz) were up between 1.3 and 4.2 percent.

Lloyds TSB (LLOY.L: Quote, Profile, Research, Stock Buzz) shed 4.9 percent to top the FTSE 100 losers' list however, after it said first-half profit fell 70 percent from a year ago as it took a 585 million pound hit from its exposure to risky assets and adverse volatility in its insurance arm.

Also in the financial sector, Admiral Group (ADML.L: Quote, Profile, Research, Stock Buzz) soared 6.2 percent after the UK car insurer said the outlook was encouraging, and that it was confident it could maintain good ancillary income despite the consumer downturn. Aviva (AV.L: Quote, Profile, Research, Stock Buzz) was up 5.5 percent after the insurer reported a 12 percent rise in first-half profit and announced a long-awaited deal to reallocate surplus assets held by two with-profit funds.

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"It's mildly encouraging in the short-term but the bigger picture is that we've got a welter of results out this week and they are likely to have a big impact on things."

"We're still trending downwards, it's just that the market never travels in a straight line," he said.

NEXT PULLS RETAILERS DOWN

Among other decliners, Next (NXT.L: Quote, Profile, Research, Stock Buzz) lost 1.9 percent after the British clothing retailer posted a 6 percent fall in first-half underlying sales, in line with forecasts, and said it expected a similar decline in the second half amid a worsening economy.

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Confectionery giant Cadbury (CBRY.L: Quote, Profile, Research, Stock Buzz) put on 1 percent after posting a 46 percent rise in first-half profits and saying it was confident for 2008 with sales growth seen at the top of its target and margins ahead of the market consensus.

/... http://www.reuters.com/article/marketsNews/idCAL068620020080730?rpc=44&sp=true