Britain's leading shares pushed higher on Thursday, buoyed by strength in heavyweight miners and banks, and by gains from real estate issues as Capital Shopping Centres bounced on bid interest. At the close, the FTSE 100 was up 41.83 points, or 0.7 percent, at 5,698.93, dipping back in the closing auction after hitting a late-afternoon peak above 5,700.
Volumes were light, however, at 64 percent of the 90-day moving average, lacking US participants, with Wall Street closed for the Thanksgiving Day holiday. "Markets are quiet, with the American celebrations creating ... a chance for getting in a practice long lunch ahead of the pending entertaining season," said Will Hedden, a sales trader at IG Index.
"Much the same can be expected tomorrow, with perhaps a slight improvement in the afternoon when America drags itself out of bed ... to finish early and hit the shops for the official start of Christmas shopping season on 'Black Friday'."
Real estate investment trusts were strong risers on the blue chip and mid-cap leaderboards after the largest US mall owner Simon Property flagged a potential offer for Capital Shopping Centres in which it currently holds a 5.6 percent stake, sending CSC's shares up 12.9 percent. On Wednesday, CSC said it was in talks to buy Manchester's Trafford Centre shopping mall for 1.6 billion pounds from Peel Group, which would see Peel end up with around a 20 percent stake in CSC.
The CSC bid speculation boosted sentiment towards the sector, with blue chips Hammerson and British Land up 4.8 and 2.9 percent, while mid-cap Capital & Counties gained 4.6 percent. Bank were higher as recent concerns over European sovereign debt exposure eased further, with Lloyds up 0.5 percent, Royal Bank of Scotland up 0.7 percent and global sector heavyweight HSBC up 0.6 percent. Mining was the strongest sector, extending Wednesday's rally as metal prices recovered. Anglo American added 2.7 percent, Rio Tinto gained 2.2 percent, and Xstrata firmed 2.1 percent.
Insurer Old Mutual added 2.12 percent, with traders citing an upgrade in Goldman Sachs's investment recommendation to "buy" from "neutral" as part of a European sector review. A broker upgrade also aided Marks & Spencer, up 2.4 percent, with Arden Partners raising its rating on the shares to "buy" from "neutral", citing supportive trading conditions.
Oil explorer Cairn Energy gained 3.5 percent as Oriel Securities upgraded its rating to "add" from "hold". Cairn also got a lift after an Indian oil ministry source said the firm had sought the Indian government's approval to switch control of three producing blocks to Vedanta Resources, a key step in sealing the sale of its Indian assets. Also brightening the market mood was a survey by the Confederation of British Industry showing that British retail sales growth accelerated in November.
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