UK stocks rebounded today as miners regained ground after grim falls yesterday, though final gains were small.
The FTSE 100 ended the session 0.4 per cent higher at 5,858.41 but recorded a high of 5,884.66 in the day’s trading as investor confidence returned.
Bargain hunters moved in on miners, which recovered along with metals prices today and pushed Mexican precious metals miner Fresnillo up 4.2 per cent to close at 1,356p.
With peers Antofagasta (up 3.1 per cent to end at 1,196p); Kazakhmys (up 2.3 per cent to close at 1,235p); Rio Tinto (up two per cent to 4,115p); Randgold Resources (up two per cent to 1.4,813p) and BHP Billiton (up 1.8 per cent to 2,345p) all in the top risers the sector dominated the gains made in the day.
Commodity trader Glencore added 2.1 per cent but still ended at 525p, below its issue price, on its first day of unconditional trading.
Integrated oil stocks also found favour, as crude rose after Goldman Sachs hiked its oil price forecasts.
BG Group rose 2.5 per cent to 1,376.5p after the same broker hiked its target price for the company, while Cairn Energy added four per cent to finish at 435.8p, after heavy trading, as it announced a drilling campaign offshore Greenland.
However, UK banks, retailers and airlines had a worse day, with Marks & Spencer leading declines after it tempered strong results with a poor outlook.
It fell 2.9 per cent to finish at 385.6p after saying it had made a good start to the new financial year but expected trading conditions to be challenging going forward.
Banks also fell, led by Lloyds, down 2.2 per cent to 49.74p, and followed by RBS (down 1.1 per cent to 40.44p) and Barclays (down one per cent to 265.6p).
“UK banks are struggling to make headway on concerns that ratings agency Moody’s could cut their credit ratings citing the imminent withdrawal of UK government support, as the agency announced it was reviewing the current rating levels,” said CMC Markets analyst Michael Hewson.
And airlines suffered as an ash cloud from Iceland’s Grimsvotn volcano closed airspace in Scotland and Ireland, despite their protests. British Airways owner International Consolidated Airlines Group lost 1.8 per cent to end at 230.8p.
In the US, Wall Street slipped for a second day as investors fretted over dollar strength and a slowdown in manufacturing.
Following much weaker-than-expected New York and Philly Fed manufacturing surveys last week, the Richmond Fed survey today showed that manufacturing in the central Atlantic region stalled in May after expanding for seven months.
The Dow Jones industrial average closed 25.1 points down, or 0.2 per cent, at 12,356.21.
The Standard & Poor's 500 Index fell by 1.09 points, or 0.1 per cent, to finish at 1,316.28.
The Nasdaq Composite Index dropped 12.74 points, or 0.46 per cent, to end at 2,746.16.