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THE LONDON REPORT

MINERS and banks were buoyed by better US durable goods data yesterday, offsetting weaker food retailers and producers and driving the FTSE 100 up by 1.2 per cent, or 49.96 points, to close at 4,279.98.<br /><br />The index has gained more than 23 per cent since hitting a six-year low in March, but is still down 3.5 per cent on the year.<br /><br />&ldquo;What is clear is that investors have fully bought into the idea that the worst is behind us,&rdquo; said Omer Bhatti, head sales trader at World Spreads. &ldquo;They were buying into the falls during this week and are fully prepared to buy into any further short term fall, as far as they are concerned it&rsquo;s just a better price to be long from.&rdquo;<br /><br /><strong>Anglo American</strong> remained the top riser, up more than 10 per cent as takeover speculation continued to fuel interest in the stock, after <strong>Xstrata</strong> put more pressure on the takeover target to come to the negotiating table. <br /><br />&ldquo;Speculation about corporate activity in the mining sector has been good for the market and adds a little extra to the price,&rdquo; said Mike Lenhoff, chief strategist and head of research at Brewin Dolphin Securities.<br /><br />Among the other miners, <strong>Kazakmys, Eurasian Natural Resources, Vedanta Resources, Rio Tinto</strong> and <strong>Xstrata</strong> gained between 3.1 and 6.9 per cent.<br /><br />Banks, the index&rsquo;s second weightiest sector, found favour after recent falls, with traders waiting on rate-setting news from the US Federal Reserve later in the day.<br /><br /><strong>Barclays, Standard Chartered, Lloyds Banking Group, Royal Bank of Scotland</strong> and <strong>HSBC</strong> gained between 1 and 5.3 per cent.<br /><br />Oil majors reversed early losses as crude moved back above $69 a barrel. <strong>BP</strong> and <strong>BG Group</strong> were up 0.4 and 0.3 per cent respectively.<br /><br />Food retailers and producers suffered, with <strong>Tesco, Sainsbury, Morrison</strong> and <strong>Unilever</strong> losing between 0.4 and 1.8 per cent.<br /><br /><strong>Man Group</strong>, the world&rsquo;s largest listed hedge fund manager, topped the FTSE fallers, shedding 4.1 per cent on news Morgan Stanley was placing 12m shares in a range of 267p to 272p.