LONDON (Reuters) - Basic materials shares helped the top equity index to a second straight weekly gain on Friday, offsetting a fall in bottling firm Coca Cola Hellenic following its results.
The index was up 1.4 percent for the week, rallying from six-week lows at the beginning of February. It climbed above its 50-day moving average on Thursday, a technical signal which suggested underlying support from buyers.
“We have managed to hold the December lows and, given the buying levels on the weak market, we remain encouraged,” said Atif Latif, the director of trading at Guardian Stockbrokers.
“The FTSE still remains in an uptrend and we continue to see the market pushing higher.”
Basic materials added 5.7 points to the index and miners gained 1 percent. Mining stocks are up 6.3 percent this year, 4.3 percent of which has come in the last week.
Global strategists at Citi recommended investing in basic materials shares with an emerging market exposure, highlighting lower capital expenditure and improved cash flow generation.
Precious metals miner Fresnillo surged 5.3 percent as gold posted its best week in six months, while other miners were supported by a firmer copper price.
Anglo American fell 0.9 percent, however, reversing early gains even after the company beat consensus with its 2013 operating profit and reported a profit at its platinum unit.
Issues specific to Anglo, such as rising net debt and negative free cash flow this year, could weigh on the shares, analysts at Jefferies said. They expect profit-taking on a stock that is up over 16 percent already so far this year.
Overall, the FTSE 100 was up 4.20 points, up 0.1 percent, at 6,663.62 points by 1549 GMT.
Coca-Cola Hellenic was the top faller, down 2.3 percent as concerns over its growth outlook and the effects of recent emerging market turmoil outweighed slightly better than expected results.
“Full year results are a touch better than we (and consensus) had (estimated) ... with Q4 margins better than expected,” analysts at Credit Suisse wrote in a note, cutting their target price to 1,500 pence from 1,790 pence.
“However market growth remains elusive and FX will take a greater toll in 2014 - we lower our estimates by 13 percent.”
Editing by Jon Boyle