London’s FTSE 100 Index surged close to a new all-time high as the traditional Santa rally gave blue chips a boost.
The first trading session since the Christmas break saw mining stocks lead the top tier higher, with rising oil prices helping commodity firms.
The FTSE 100 lifted 28.4 points to 7096.5 in thin trading volumes, within striking distance of its all-time closing high of 7104, set on April 27.
But airlines and banks missed out on the festive rally, while a profit warning from Bovis Homes saw the housebuilder suffer share losses in the FTSE 250 Index.
David Cheetham, market analyst at online trading group XTB, said: “Observers of the markets have for many years noticed a strong propensity for stocks to rise in the period between Christmas and the New Year and this phenomenon appears to be playing out once more.”
He added that falls in the value of the pound against the US dollar and a raft of currencies was also helping the FTSE gain ground.
Commodities were helped further by a hike in the cost of crude as benchmark Brent lifted 0.5% higher to 56.36 US dollars a barrel.
Mining giant BHP Billiton led the FTSE 100’s advance, up 4% or 53p to 1310.5p.
British Airways owner International Consolidated Airlines was seeing contrasting fortunes, down 2% or 10.4p to 446.9p, followed close behind by low-cost rival easyJet, off 16p at 1019p.
Bovis dropped 5% or 40.5p to 815.5p in the second tier after the group warned over profits as it said build delays in the run-up to Christmas would hit sales.
The builder said it would miss its 2016 sales target due to “slower-than-expected build production” in December, with completions on around 180 homes set to be delayed into early 2017.
But retailers Sports Direct and online fashion group Boohoo were enjoying gains after unveiling deals.
Sports Direct was 2% higher in the FTSE 250 – up 6.8p at 279.2p – after announcing the £112 million (137.5 million US dollars) sale of its Dunlop brand to Japan’s Sumitomo Rubber Industries on Tuesday.
Elsewhere, boohoo.com lifted 3.8p to 136p after revealing plans to snap up the brand of collapsed US fashion firm Nasty Gal in a 20 million US dollar (£16 million) deal.
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