Firm commodity prices yesterday sent London shares to a 15-month high, eradicating all the losses that the blue chip stock index has suffered since Lehman collapsed. The FTSE 100 rose 22.02 points to 5,424.43, with mining companies leading the way, consolidating gains made when it was last open, on Christmas Eve, when it breached the 5,400 barrier. On the last trading day before Lehman was made bankrupt, September 12, 2008, the index was at 5,416.7.
Copper prices rose to their highest since September 2008 as trading in London Metal Exchange contracts resumed after a four-day holiday, chasing gains made in Shanghai over the break.
The rise came as strike votes in two large Chilean copper operations threatened output disruptions, supporting prices. That helped to buoy other metals producers, with Vedanta Resources up by 86p at GBP 26.26, Lonmin up by 53p, or 2.8 per cent, at GBP 19.33, Kazakhmys up by 31p at GBP 13.19, BHP Billiton rising 48p to GBP 20.18 and Xstrata up by 234.5p at GBP 11.11.
British Airways, hit by worries about another strike ballot after the last vote was declared unlawful and by concern about the impact of tightened security measures in the US after the thwarted terrorist attack on a flight from Amsterdam to Detroit, was the hardest faller, losing 2.2p, or 1.1 per cent, at 189.8p.
In Tokyo, the Nikkei average, celebrating the 20th anniversary since its peak, just scraped to a positive close after briefly touching a four-month high, as falling bank stocks counteracted rising retail stocks. It finished up 3.83 points, or 0.04 per cent, at 10,638.06, an increase of 50 per cent since its March low. However, the Tokyo index is still only about a quarter of the peak it reached 20 years ago.
The MSCI index for Asia excluding Japan edged up 0.3 per cent, but was still some way off matching last month’s peak for the year. It looked set to post a gain of well over 60 per cent for 2009, but is still about 30 per cent off its late 2007 peak before the global financial crisis erupted.
Oil traded relatively flat below US $79 a barrel after a day in which it closed near to a five-week high of US $80 a barrel on expectations that colder weather in the US and signs of economic recovery would help energy demand.
Shares in Australia outperformed, rising 1.1 per cent to a nine-week closing peak as Nufarm, a farm chemicals group, agreed to sell a stake of up to 20 per cent to Japan’s Sumitomo Chemical Corp for about US $590 million.
