Leading shares are climbing for the fourth day in a row, as growing hopes that the global economy might avoid a double dip recession continued to tempt investors back into the market.
Miners and banks are again the main drivers, the former on demand hopes, the latter on speculation the European stress tests might not throw up any new horrors.
So ahead of the start next week of the US reporting season, the FTSE 100 has followed overnight rises on Wall Street and in Asia with a 10.74 point gain to 5116.19. Joel Kruger, currency strategist at Daily FX, said:
Global equities remain well bid into Friday trade and the resulting price action continues to have a favorable impact on the UK markets as investors flow back into risk and out of the safe haven securities. A combination of stronger labour data out of Australia, upbeat comments from the European Central Bank's Jean-Claude Trichet, solid German industrial production, and better than expected US initial jobless claims, have all contributed to the most recent risk rally, with some weaker data on the domestic front failing to materially weigh on UK investor minds. Nevertheless, we remain skeptical of the rally and would continue to recommend that traders proceed with caution, as the state of the global economy still remains quite uncertain, and could once again come back under pressure to weigh on the UK markets.
With base metals such as copper moving higher, Rio Tinto is up 105.5p to £31.79 and Antofagasta has added 28.5p to 880p. But gold miner Randgold Resources has slipped 50p to £61.95 after Goldman Sachs moved from neutral to sell. The bank also cut its recommendation on Hochschild Mining, down 9p to 309.1p, from buy to neutral. Goldman said:
Gold stocks are trading at elevated levels and as such the risk/reward balance is skewed more to the downside.
Elsewhere BT is 2.7p better at 138.7p after agreeing a three year pay deal with the CWU, ending a recent period of dispute.
