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THE LONDON REPORT

BRITAIN&rsquo;S top share index edged higher yesterday as miners and oil stocks buoyed by firmer commodity prices lent support, though with investors nervous before the group of 20 leaders&rsquo; meeting at the end of the week.<br /><br />The FTSE 100 closed 8.24 points, or 0.2 per cent, higher at 5,142.60, after ending Monday&rsquo;s session 0.7 per cent lower &ndash; snapping a six-session winning streak.<br /><br />&ldquo;It&rsquo;s a quieter week on both sides of the pond - and we&rsquo;ve also got slight nervousness ahead of the G20, so I think markets are marking time a bit,&rdquo; said Howard Wheeldon, strategist at BGC Partners.<br /><br />Mining stocks peppered the blue-chip leader board after a bounce in metals prices driven by a weaker dollar.<br /><br /><strong>Eurasian Natural Resources, Fresnillo, Rio Tinto, Lonmin </strong>and <strong>Randgold Resources</strong> rose between 2 per cent and 4.4 per cent.<br /><br />Energy stocks were in demand as crude rose above $71 a barrel, again supported by the weaker dollar, with <strong>Royal Dutch Shell, BP</strong> and Cairn Energy adding 0.7 to 1.1 per cent.<br /><br /><strong>Tullow Oil,</strong> up 0.4 per cent, was also spurred on by positive comment from <strong>Morgan Stanley</strong>, which hiked its target price for the stock to 1,500p from 1,225p.<br />&ldquo;Tempted to lock in profits on Tullow? We think this would be wrong,&rdquo; the broker said in a note.<br /><br />Morgan Stanley argued that the buy case for the oil explorer is more compelling today as energy markets tighten and as it rolls out a drilling campaign the broker thinks could double the share price.<br /><br /><strong>Carnival</strong> led the blue-chip gainers, up 5 per cent, after the cruise operator raised its 2009 earnings forecast helped in part by stronger booking volumes. <br /><br />Ahead of its results, <strong>Bank of America-Merrill Lynch</strong> had added Carnival to its &ldquo;Europe 1&rdquo; list.<br /><br />The FTSE 100 index has risen 48.6 per cent since hitting a six-year trough in March, but is still down more than 5 per cent from its level prior to the collapse of US bank <strong>Lehman Brothers</strong> a year ago.<br /><br />&ldquo;I&rsquo;m perfectly content to believe that the worst of the global recession is now behind us; I am far from content to believe that the problems for the UK won&rsquo;t in a sense worsen before they get better,&rdquo; said Wheeldon.<br /><br />Utilities and food retailers were out of favour as investors shunned the defensive issues as their appetite for risk returned.<br /><br /><strong>Severn Trent</strong> shed 1.5 per cent as investors fretted over the possibility of a rights issue from the water company.<br /><br /><strong>Evolution Securities</strong> downgraded its rating on the stock to &ldquo;add&rdquo; from &ldquo;buy&rdquo;. <br /><br />Fellow utilities <strong>National Grid</strong> and <strong>United Utilities </strong>dropped 0.8 per cent and 2.2 per cent, respectively.<br /><br />Among food retailers, supermarket chain <strong>Tesco</strong> fell 1.6 per cent after the it was reported its retailing services chief executive Andrew Higginson warned of a flat Christmas at best for British retailers.