THE FTSE 100 yesterday staged a dramatic end-of-week rally to close 69.3 points up at 6554.9. Largely propelled by very strong growth from both miners and builders, the index never looked like dropping on a day when investors leapt upon rumour and optimism to drive key stocks into near double digit growth.
Top of the climbers was mining company Xstrata which climbed 268p to close out at 3656p. As much as volatility seems to have been the key word in the mining sector recently, the tremendous and sustained growth over recent times has captured the imagination of investors who are swift to seize upon any extra motivation to buy into the big firms.
Yesterday’s big rumour surrounding Xstrata was that of a takeover from Anglo American – reportedly and understandably in an attempt to bolster its position should the much-vaunted tie-up between BHP Billiton and Rio Tinto come to fruition. Ironically and almost prophetically, the chief executive of Xstrata had, earlier in the week, alluded to the possibility of a fresh wave of mergers.
Other climbers included Northern Rock – up 7.6p at 111p following the withdrawal of the TC Flowers consortium and renewed hope of a higher offer for shareholders.
On the losers list, amongst other small decreases, were British supermarkets WM Morrison, who fell 1.75p to 312p, and Tesco – down 2.25p at 477p, following the judgement of price fixing on dairy goods.
Ian McElroy Barclays Wealth.