Oils and miners bring FTSE higher, while banks also rise

BRITAIN&rsquo;S leading share index gained 1.4 per cent as stocks enjoyed a broad-based recovery yesterday, with heavyweight oils and miners in demand as raw material prices rose while financials also rallied.<br /><br />By the close, the FTSE 100 was 66.91 points higher at 4,756.58, having reversed earlier losses to close slightly higher on Wednesday.<br /><br />The UK benchmark has gained 37 per cent since hitting a floor in early March, and is up 6.8 per cent so far this year. However, volumes on the index have been low on average in August, the height of the holiday season.<br /><br />&ldquo;The market seems to be kind of defying belief at the moment. There definitely seems to be support, with the dips reasonably shallow and a definite desire for investors to move in,&rdquo; said Tim Whithead, strategist at stockbrokers Redmayne Bentley.<br /><br />&ldquo;However, one wonders with cyclical stocks driving the advance and traditional defensives being left behind, if there was something to spook the market, whether this could be turned on its head.&rdquo;<br /><br />Oil majors were the blue chip index&rsquo;s top gainers, with crude holding above $72 a barrel after industry data yesterday showed a steep drop in US oil imports and stocks.<br /><br /><strong>BP, Royal Dutch Shell, BG Group,</strong> and <strong>Cairn Energy</strong> added 1.4 to 2.9 per cent.<br /><br />Miners also joined in the rally on hopes for increased demand for metals. <strong>Angtofagasta, Xstrata, Lonmin, Anglo American, Vedanta Resources</strong>, and <strong>Kazakhmys</strong> were up from 2.4 to 5.3 per cent.<br /><br />Rio Tinto, the world&rsquo;s second-largest miner, added 1.0 per cent after posting a record drop in first-half profit, in line with market forecasts, and saying it was confident about the future after a tough 18 months.<br /><br />Banks also rose, helped by sentiment from the successful placement of the Swiss government&rsquo;s stake in <strong>UBS. Barclays, Lloyds Banking Group, Royal Bank of Scotland</strong>, and <strong>HSBC</strong> took on 0.4 to 3.9 per cent.<br /><br />Insurers moved higher as equity valuations rose, with <strong>Prudential, Standard Life, RSA Insurance</strong>, and <strong>Friends Provident</strong> up 2.5 to 4.5 per cent.<br /><br />US blue chips were modestly higher by London&rsquo;s close, up 0.3 per cent as investors digested a mixed bag of data.<br /><br />US initial jobless claims unexpectedly rose last week, but investors took heart from news the Philly Fed business activity index turned positive in August.