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FTSE ends above 6,100 resistance level
January 10, 2013 / 9:27 AM / 5 years ago

FTSE ends above 6,100 resistance level

LONDON (Reuters) - The FTSE 100 closed above the 6,100 resistance level for the first time since May 22 2008, recovering from a late wobble after a choppy trading session.

The London Stock Exchange is seen during ther morning rush hour in the City of London April 11, 2011. REUTERS/Toby Melville

The FTSE 100 index was up 2.86 points, or 0.1 percent, at 6,101,51, having seen some late profit-taking erased in the closing auction, but the gains seemed fragile to traders.

“The index is looking toppy at the moment, providing an opportunity for traders to book profits,” said Ishaq Sidiqqi, market strategist at ETX Capital.

“It is likely we will see a retreat in tomorrow’s session, particularly with (British) manufacturing and industrial production numbers out which may be a lot uglier than expected after the recent slide in PMI services data.”

Banking was the top performing blue chip sector as it drew continued strength from the recent decision by global regulators to water down their liquidity requirements.

HSBC added 0.5 percent, alone providing nearly all of the blue chip’s points gain, after saying its $9.4 billion (5.8 billion pounds) deal to sell its stake in Chinese insurer Ping An remains on track, scotching recent media reports that the sale had run into trouble.

Emerging markets-focused peer Standard Chartered also saw good gains, ahead 0.8 percent, with traders citing the impact of an upgrade in rating by Societe Generale to “buy”.

Chip designer ARM Holdings was the top blue chip riser, up 4.4 percent, lifted by rumours of a new, cheaper Apple iPhone, which uses the firm’s products.

A worker shelters from the rain as he passes the London Stock Exchange in the City of London at lunchtime October 1, 2008. REUTERS/Toby Melville

A reversal by miners was a big drag on blue chip sentiment, with the sector running into profit-taking late on after gains earlier following trade data from China which showed exports from the world’s top metals consumer recovered in December.

Commentators pointed out that weak money supply data illustrated some slowing of the pace of growth in China, with a glut of further data due from the country over the next week.

“The trade data points to continued economic growth, underpinning our positive view on the likes of the mining sector, but the slowing in growth of money supply may erode expectations for further acceleration of the Chinese economy in the second half of 2013,” Shore Capital market strategist Gerard Lane said.

A trader monitors the screen on a trading floor in London January 22, 2010. REUTERS/Stefan Wermuth


Blue chip retailers were again the big focus in London following trading updates from both Tesco and Marks & Spencer with the picture on the UK high street mixed.

Tesco rose 1.8 percent after the world’s third largest retailer posted its highest sales growth in three years, offering signs that a turnaround strategy is beginning to show results.

Peer Marks & Spencer, however, was a blue chip faller, down 0.6 percent after reporting a steep drop in its non-food sales in the Christmas quarter, leading Espirito Santo Investment Bank to cut its rating to “sell” from “neutral”.

“M&S has disappointed investors many times and though the reasons have varied (rain, Olympic distraction, buying mistakes, competitor promotions etc) the conclusion seems increasingly clear that customers are just not happy with M&S’s product and value,” Espirito Santo said in a note.

Volume in M&S shares was by far the biggest on the FTSE 100 index, at over four times its 90-day daily average, with total blue chip volume at around 108 percent of its daily average.

Reporting by Jon Hopkins; editing by Ron Askew

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