Bloomberg News

U.K. Stocks Climb to Three-Week High; ITV, Petrofac Lead Advance

December 29, 2011

Dec. 29 (Bloomberg) -- U.K. stocks climbed, sending the benchmark FTSE 100 Index to three-week high, as U.S. data showed business activity and home sales in the world’s largest economy increased more than forecast.

Companies from ITV Plc to Petrofac Ltd. and Next Plc all climbed more than 1 percent in London trading.

The FTSE 100 added 59.39, or 1.1 percent, to 5,566.77 at the close in London, the highest level since Dec. 6. The broader FTSE All-Share Index also rose 1 percent today, and Ireland’s ISEQ Index gained 0.5 percent.

The FTSE 100 has lost 5.7 percent this year amid concern the debt crisis that has sent euro-area borrowing costs record highs will weaken global economic growth. Italy today sold 7 billion euros ($9 billion) of bonds today in the country’s final debt sale of the year.

“The U.S. data was OK, which has helped sentiment,” said Trung-Tin Nguyen, a hedge fund manager at TTN AG in Zurich. “Moves are exaggerated with the light volumes.”

The volume of shares in the FTSE 100 that changed hands today was less than 40 percent of the daily average this year, according to data compiled by Bloomberg.

Stocks climbed today as business activity in the U.S. expanded more than forecast in December, a sign American manufacturing is weathering the slowdown in Europe. The Institute for Supply Management-Chicago Inc. said its business barometer decreased to 62.5 from 62.6 in November. Readings above 50 signal growth. Economists had forecast the gauge would fall to 61, according to a Bloomberg survey.

U.S. Home Sales

The number of Americans signing contracts to buy previously owned homes rose more than forecast in November as falling prices and low borrowing costs boosted demand. The index of pending home sales increased 7.3 percent to the highest level since April 2010 after climbing 10.4 percent the prior month, figures from the National Association of Realtors showed. Economists had forecast a 1.5 percent gain, according to the median estimate in a Bloomberg survey.

ITV, Britain’s biggest commercial broadcaster, paced advancing shares. The stock climbed 2.1 percent to 66.9 pence.

Petrofac, a provider of oilfield services and engineering, climbed 2.2 percent to 1,446 pence. Next, the U.K.’s second- largest clothing retailer, gained 1.8 percent to 2,737 pence.

--Editor: Andrew Rummer

To contact the reporter on this story: Sarah Jones in London at sjones35@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net


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