FTSE ends up on Bush mortgage plans

By Dominic Lau

LONDON (Reuters) - The leading share index rose 1.5 percent on Friday, lifted by U.S. President George W. Bush's plans to tackle the subprime mortgage crisis, which has plagued global financial markets for the past two months.

The FTSE 100 .FTSE was up 91.3 points at 6,303.3, for a weekly gain of 1.3 percent. The benchmark index lost 0.9 percent for the month on concerns over the extent of the fallout from the crisis in the risky U.S. subprime lending sector, but is still up 1.3 percent for the year.

Bush unveiled plans for the government to help some struggling subprime mortgage borrowers avoid foreclosure, but said it is not the government's job to bail out speculators.

"The market is a bit more confident that various institutions will act in order to prevent the housing crisis getting any worse," said Neil Parker, market strategist at Royal Bank of Scotland.

"It has been a decent recovery but let's not count our chickens. Volatility will remain very high in the equity markets in the course of the next few weeks."

Commodity shares led the FTSE's advance, adding nearly 30 points to the index, as higher metal prices boosted miners and U.S. crude prices edged towards $74 a barrel.

Oil major BP (BP.L) gained 1.2 percent and rival Royal Dutch Shell (RDSa.L) added 1.4 percent. Gas producer BG Group (BG.L) rose 1.5 percent, also boosted by a UBS upgrade to "buy" from "neutral".

In the mining sector, BHP Billiton (BLT.L), Rio Tinto (RIO.L), Kazakhmys (KAZ.L), Anglo American (AAL.L), Vedanta Resources (VED.L) and Lonmin (LMI.L) rose 1.7 to 4.4 percent.