Banks and miners help push FTSE to three-week highs

By Sudip Kar-Gupta

LONDON (Reuters) – The top equity index hit its highest level in around three weeks on Friday, boosted by gains in sectors seen as among the most sensitive to an upturn in the global economy, such as banks and miners.

The blue-chip FTSE 100 index closed up by 0.7 percent, or 46.41 points, at 6,695.55 points.

Global equity markets were also buoyed by U.S. employment data, which suggested the world’s biggest economy may be gaining momentum.

U.S. employers maintained a solid pace of hiring for a second straight month in March, the non-farm payrolls report showed, highlighting resilience in an economy that had been hit by a brutally cold winter.

London-listed banking and mining stocks – which often outperform on signs of global economic growth but can also underperform on weak economic data – added the most points to the FTSE 100.

“There are interesting stocks to be had right across the market. Miners like Rio Tinto and BHP Billiton, and banks like Standard Chartered and Barclays look interesting,” said Investec Asset Management fund manager Max King.

The FTSE 100 rose 14.4 percent in 2013 to post its best annual gain since 2009.

The index reached a peak of 6,867 points in January this year, its best level since early 2000, but it has since slipped back due to concerns over a slump in emerging markets and tensions between Russia and Western powers over Ukraine.

Deutsche Bank’s equity strategists expect the FTSE to end 2014 at the 7,500 point level, which would mark a record high for the index. Hantec Markets analyst Richard Perry also sees the FTSE recovering from the pullback in March.

“The momentum is with the recovery on the FTSE,” said Perry.

However, Strand Capital managing director Kyri Kangellaris sees the FTSE stuck in a range of 6,500-6,850 points, as long as it fails to break above its January high of 6,867 points and last year’s peak of around 6,876 points.

“We’re looking range-bound for the near term,” Kangellaris said.

(Additional reporting by Tricia Wright; Editing by Catherine Evans and Susan Fenton)