Commodities fuel FTSE gains

The FTSE 100 was off to a positive start this morning led upwards by commodity stocks which were boosted by strong data from China.

Asian markets were given a lift as the official Chinese purchasing managers' index indicated a rise in factory activity in December and London followed suit.

Industrial metals such as copper rose on hopes of increased demand from the global economic powerhouse.

Following the figures from China UK manufacturing also received a boost as the domestic purchasing managers' index showed a rise from 47.7 in November to 49.6 in December.

The Markit/CIPS report suggested that the sector was still weak but was stabilizing.

Miners Xstrata, Kazakhmys, Rio Tinto and Antofagasta were all up more than three per cent, in early trading.

But automotive Engineer GKN was the highest climber on London's blue chip index, up 3.7 per cent after announcing an expansion of its operations in India.

Among banks Lloyds was up 0.5 per cent while Barclays lifted by 1.5 per cent.

BP was up more than one per cent after it said it was suing contractor Halliburton to try to force the company to pay all costs and expenses it incurred to clean up the 2010 Gulf of Mexico oil spill, which the oil major previously put at around £26bn.

The poorest performers were insurer Standard life, down 0.8 per cent, and Shell which nudged down by 0.6 per cent.

The Hang Seng closed up 2.4 per cent with PetroChina gaining 4.5 per cent and China Petroleum & Chemical Corp 5.5 per cent.

Meanwhile US crude jumped around 1.5 per cent to almost $109 a barrel, also reflecting a bounce over the Christmas period due to escalating tensions between Iran and the West.

In the US November construction spending numbers are due for release later.