Miners and banks help FTSE overturn three days of losses

BRITAIN’S top shares broke a three-day losing streak yesterday as miners spurred by upbeat comments from China, outpaced falls in oils led by BP as concerns lingered over the Gulf of Mexico oil disaster.

The FTSE 100 ended 6.68 points or 0.1 per cent higher at 5,026.44, in choppy trade. The index is down more than 13 per cent since fears escalated about the Eurozone sovereign debt crisis in mid-April, after a 22 percent gain in 2009, and fell below 5,000 on Friday for the first time since November.

“The upside continues to remain constrained by fears of further problems in the Eurozone,” Michael Hewson, analyst at CMC Markets said.

“While the down side remains supported by hopes that China may delay implementing further brakes on its economic growth ... and a number of key technical level support levels.”

Miners were the top performers boosted by comments by a state planning official that China should be particularly cautious in introducing new tightening measures.

Anglo American and Rio Tinto added 1.7 and 1.6 per cent respectively

Randgold Resources rose 1.5 per cent, along with gold, which gained as lower prices tempted buyers back to the market amid concerns over the fiscal health of the Eurozone.

Banks, which have taken a beating while the euro zone tackles its debt crisis, rallied after data showed sales of previously owned homes in the United States rose more than expected in April to a five-month high, which led Wall Street stocks to pare losses.

Royal Bank of Scotland, Barclays, HSBC, and Standard Chartered rose 0.2-1.2 per cent.

Sector gains were tempered after the Spanish government on Saturday took over the running of savings bank CajaSur after its planned merger with another of the country’s small lenders failed.

Perceived defensive firms featured highly on the gainers list, as investors looked for shelter as Eurozone debt problems hung in the background.

Imperial Tobacco, supermarket group Sainsbury and consumer goods company Reckitt Benckiser climbed 1.5-2.1 per cent.

On the downside, energy stocks retreated as an oil spill in the Gulf of Mexico soured sentiment towards the sector.

BP, down 2.7 per cent, has pledged $500m to an open research programme studying the impact of the Deepwater Horizon incident that threatens an ecological disaster.

Shares in BP have fallen more than 15 per cent in May, on track for its biggest monthly loss since 1992.

Peer Royal Dutch Shell fell 1.5 per cent. Chancellor George Osborne also outlined plans to cut £6.25bn of government spending yesterday.