Resource stocks stoke FTSE gains

The FTSE 100 saw solid gains this morning as resource and energy stocks were boosted by upbeat forecasts from US aluminium giant Alcoa and figures showing growing demand from China.

Alcoa, the largest US aluminium producer, reported fourth-quarter revenue that beat Wall Street expectations, even though it registered a loss.

The earnings news had a positive knock-on effect on Asian shares.

London copper rose today after data showing a lift in imports by the top consumer China supported prices.

However the continuing doubts over the viability of a recovery in the Eurozone cast a shadow.

Miner Kazakhmys was the highest climber on London's blue chip index, up just over three per cent.

In the same sector Vedanta jumped by just under three per cent along with Cairn Energy.

Cairn's lift came after it said it would return $3.5 billion of cash to shareholders following completion of the deal to sell a majority stake in its Indian business to Vedanta Resources.

Oriel Securities upgraded its rating for Cairn Energy to "add" from "hold".

Meanwhile Lloyds and Barclays both made it into the top five gainers on the index, both rising by more than 2.5 per cent. RBS also rose after reports that it would be shedding more staff as part of cost cutting measures.

In retail Marks & Spencer nudged up by 2.6 per cent after reporting a modest sales rise mainly fuelled by discounting.

FTSE-250 listed Debenhams was up 6.8 per cent after also reporting a sales rise.

In negative territory, down 0.7 per cent, was GlaxoSmithKline which yesterday reported problems with tests on its lung disorder treatment Relovair.

Also in pharmaceuticals AstraZeneca was down 0.4 per cent following the admission yesterday that it had mistakenly released secret data to analysts, forcing it to reaffirm its financial results.

iPhone chipmaker Arm Holdings and medical appliance maker Smith & Nephew were off by 0.3 per cent.

FTSE 250 listed recruiter Hays was off by 2.3 per cent after reporting a slump in the domestic market.

In Asia the Nikkei closed up 0.3 per cent and the Hang Seng 0.7 per cent.

Meanwhile in UK economic news the Royal Institution of Chartered Surveyors showed that British house prices fell at a marginally slower pace in the three months to December against a backdrop of steady demand and a modest rise in the number of properties coming on to the market.

Across the Atlantic later US November wholesale inventories data is due for release.