FTSE strikes two month high amid weak trading yet lags euro stocks

BRITAIN’S top share index hit a two-month high yesterday, fuelled by risk-sensitive stocks, but lagged European peers as wary investors met resistance around previous year highs.

At the close, the FTSE 100 was up 9.34 points at 5,901.42. The index’s 0.2 per cent rise lagged the German DAX and the pan-European FTSEurofirst 300, up 1.1 per cent and 0.7 per cent respectively and both posting highs for the year.

The FTSE 100 hit a two-month high at 5,923.91 but failed to sustain a move through the 5,920 level, which it has tested four times since September. Relatively low volumes suggested that investors lacked conviction to break resiliently above resistance levels.

The mining sector added to the previous session’s gains, led up by Antofagasta, which gained 3.16 per cent after the plans of competitor Freeport McMoran to diversify into oil and gas prompted investors to switch into more copper-focused options.

“I think the Freeport deal is helping stocks like Antofagasta, in terms of copper scarcity,” said Credit Suisse’s Liam Fitzpatrick. The materials sector contributed 7.1 points to the index, with the top five FTSE gainers all resource-related.

However, five of the six most heavily traded stocks saw falls, as the net upward move lacked conviction.

Rolls-Royce traded over two-and-a-half times its 90-day average volume, compared to 88 percent for the rest of the FTSE 100, and was the index’s top faller. It lost 3.1 per cent as it said it had passed information to the Serious Fraud Office relating to concerns about bribery and corruption involving its intermediaries overseas.