🥇 First rule of investing? Know when to save! Up to 55% off InvestingPro before BLACK FRIDAYCLAIM SALE

Britain's FTSE extends gains, technicals support

Published 04/26/2011, 07:30 AM
Updated 04/26/2011, 07:32 AM
UK100
-
BARC
-
BP
-
UBSN
-
AZN
-
TSCO
-
SHP
-
ANTO
-
AUTN
-
ARM
-
HG
-
FTNMX551030
-

* FTSE 100 up 0.4 percent at midday

* IAG leads gainers; Antofagasta, HSBC among top fallers

* Volumes weak at start of three-session week

By Simon Jessop

LONDON, April 26 (Reuters) - Britain's top shares rose on Tuesday, led by International Airlines Group after positive broker comment, with technicals suggesting further index upside as trade entered a second holiday-shortened week.

The blue-chip FTSE 100 was up 0.4 percent at 6,040.21 at 1100 GMT, with volumes still thin after the four-day Easter weekend and ahead of another four-day holiday weekend starting with the Royal Wedding on Friday.

Recent moves suggested a slide below the broad uptrend begun in March 2009 was unlikely near term, Charles Stanley technical analyst Bill McNamara said.

The bottom rung of the uptrend, around 5,870, had been given "a fairly thorough examination recently and held up. So that is a convincing and compelling reason to remain long of UK equities, as far as I am concerned," he said.

IAG led FTSE 100 gainers, up 3.3 percent, as UBS named it the top pick among flagship carriers and said shares in European airlines could rise if the oil price stabilised and recent trends in capacity started to come through.

Brent crude remained high, however, and was just shy of $124 per barrel. Among other stocks, tech names ARM Holdings and Autonomy rose strongly, up 1.9 percent and 1.5 percent respectively, buoyed by upbeat broker comment and after bumper results from Autonomy and global peers last week.

Integrated oils added the most points to the index with heavyweight Royal Dutch Shell up 1.4 percent on a positive note from UBS, which named it as a top pick on valuation grounds.

Around midday, index volumes were just 22 percent of their 30-day average, with the bulk of the index flow visible in Shell's A and B shares, at 68 percent and 58 percent of their average, and heavyweight Tesco at 47 percent of its average.

"A lot of people are still on holiday, so I think volumes will remain quite light," said a London-based sales trader at a European investment bank.

METALS, HSBC

The market had opened lower on Asian and U.S. weakness, weighed by mining stocks on the back of a broad-based slide in base and other metals prices, and by midday they continued to occupy most spots on the FTSE fallers' list.

Copper, nickel and zinc were up to 4 percent lower around midday, while base metals-focused miner Antofagasta was the lead index faller, down 1.3 percent.

Profit-taking ahead of the start of a two-day U.S. Federal Reserve meeting on Tuesday and on concerns over monetary policy tightening in China, drove the fall in metal prices.

The Fed's quantitative easing programme has fuelled bumper gains for a range of commodities, so, with inflation concerns rising, comments around the Fed meeting will be closely watched for hints it could tighten policy quicker than expected.

Elsewhere on the downside, lender HSBC fell more than 1 percent and bucked a broadly positive sector index, weighed by overnight falls in Hong Kong and investor moves out of defensive sector plays.

"When you get people wanting to buy the more geared stocks, obviously HSBC tends to underperform in that scenario," said a financials sales trader at a leading European investment bank, citing positive results from Swiss bank UBS.

"It is a bit weaker today as people looked at UBS and thought they would take on some of the risk trade a bit more, but do not forget that volumes are minimal and most people are not around."

With little fresh British earnings news on Tuesday, traders will instead look ahead to the next two sessions, with results due from index heavyweights including Barclays, BP, AstraZeneca and Shire. Of the 17 FTSE 100 companies due to report in the current quarterly earnings season, 18 percent have already done so with 67 percent missing estimates, with an average negative surprise of 1.1 percent, according to Thomson Reuters data. (Editing by Dan Lalor)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.