Bank of England Governor Mark Carney
London stocks largely brushed aside a downbeat U.S. jobs report Friday and pushed higher, with heavyweights such as HSBC Holdings PLC and some oil majors on the rise, along with shares of Burberry Group PLC.
The FTSE 100 index rose 0.7% to 6,735.97, trading around levels not seen since early November, and set to rise 0.3% this week.
The index fell 0.5% on Thursday, driven by losses for a clutch of retailers. The same day, the Bank of England?s Monetary Policy Committee left key rates and its quantitative easing policy intact. It also didn?t provide any update on its forward-looking guidance, disappointing some investors.
The Detroit auto show starts next week?and for the first time since 2006, no Chinese car maker will be exhibiting its wares.
Stocks got a lift earlier after data showed industrial output was flat in November, against a forecast of 0.4%, with construction reportedly down the most in a year. The British pound tumbled on the data, falling from around $1.65 to $1.6413.
Driving a chunk of gains was heavyweight HSBC Holdings PLC, up 1.5%.
Shares of Burberry PLC gained 3.2%, benefiting from some upbeat news in the sector. A wide swath of luxury stocks were rising on Friday, including Swatch Group SA, which makes a range of watches from low-cost to high-end and which jumped more than 4% on optimism about a sales-growth pickup in 2014.
Food and other retailers were also showing signs of recovery after a string of sales reports pointed to a tough Christmas trading period. Marks & Spencer Group PLC was up 1.9%, continuing to gain from the prior day, where it was the exception in a downbeat sector. The retailer said it saw an improved performance for general merchandise over the holiday period.
Wm. Morrison Supermarkets PLC ??, whose shares sank nearly 8% on Thursday after a profit warning, rose close to 1%.
Miners were on the up, largely, with Fresnillo PLC an exception after Barclays analysts cut shares to equal weight from overweight, in a note that stuck to their negative weighting on the sector and concerns 2014 will be a tough year for mining companies. But Barclays lifted Glencore Xstrata PLC to overweight from equal weight, driving a 2.8% gain for the stock. Analysts also reiterated an overweight weighting on Randgold Resources Ltd., with those shares up 2.4%.
Lead Barclays analyst David Butler said that while 2014 looks difficult, free cashflow yields are starting to pick up for 2015 and earnings growth is turning positive based on their forecasts. So at some point next year, he said, the market may start to price in recovery.
?For now, they?ve shuffled ratings with a gearing towards stocks that can deliver earnings growth in a flat price environment, albeit with risk recognition of commodity specifics (our two upgrades have a copper focus),? said Butler.
Two oil stocks were on the move after a broker note from Exane BNP Paribas. The analysts cut BP PLC to neutral from overweight, but higher oil prices helped the oil major shake off that cut and shares rose 0.7%. Shares of Royal Dutch Shell PLC are repositioning towards names with ?potential for positive surprise on the restructuring front.? Also in the energy sector, Tullow Oil PLC rose 5.6% on speculation a day prior on Bloomberg that suggested the company is a takeover target for Statoil ASA
Source MarketWatch
