FTSE rises early as oils and miners rally

Fri Jun 6, 2008 8:50am BST
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By Dominic Lau

LONDON (Reuters) - The top shares index rose 1.3 percent early on Friday as commodity prices buoyed by a weaker dollar lifted miners and oil stocks, while Royal Bank of Scotland gained ahead of the deadline for its rights issue.

By 8:27 a.m., the commodity-heavy FTSE 100 .FTSE index was up 77.3 points at 6,072.6, reinstated above the psychological 6,000 level and tracking sharp gains in the U.S. and Asian markets. The benchmark index gained 0.4 percent on Thursday.

Traders awaited key U.S. non-farm payroll data for May, due at 1:30 p.m. A Reuters poll showed a median forecast of a decline of 58,000 jobs last month, compared with a contraction of 20,000 in April.

"The interesting thing about this market is that the FTSE 100 has not really wanted to give up much ground below 6,000. Also, it is not been much prepared to go above 6,000. 6,000 seems to a comfortable trading level for it," said Mike Lenhoff, chief market strategist at Brewin Dolphin.

"If the non-farm payrolls are not worse than expected, if they come in like a lot of the American data -- better than expected -- then we obviously are going to go higher."

Oil shares tracked firmer crude prices CLc1, which headed towards $129 a barrel as the dollar weakened on signals the Euroean Central Bank may raise interest rates this year.

BP (BP.L: Quote, Profile, Research) put on 2.3 percent, Royal Dutch Shell (RDSa.L: Quote, Profile, Research) added 2.1 percent, Cairn Energy (CNE.L: Quote, Profile, Research) climbed 4.1 percent and gas producer BG Group (BG.L: Quote, Profile, Research) rose by 3.6 percent.

Stronger metal prices also boosted miners, with BHP Billiton (BLT.L: Quote, Profile, Research), Rio Tinto (RIO.L: Quote, Profile, Research), Anglo American (AAL.L: Quote, Profile, Research), Xstrata (XTA.L: Quote, Profile, Research), Kazakhmys (KAZ.L: Quote, Profile, Research), Lonmin (LMI.L: Quote, Profile, Research) and Antofagasta (ANTO.L: Quote, Profile, Research) all up between 1.8 and 3.1 percent.  Continued...

 
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