FTSE advances, led by real estate as house prices rise
The FTSE advanced for a second successive day today as it was announced that house prices in the UK had a record breaking month in May, rising by an average of 0.4 percent from April to May. As expected, real estates rallied while banks took a major body blow as new mortgages are now expected to decline.
The blue chip benchmark made slight gains of 3.63 points, or 0.06 percent, rising to 6308.26 as the London Stock Exchange closed for the weekend with a ratio of almost 2:1 advancers to fallers. In a similar trend to the Nikkei 225, the index has finished the week strongly but still registered declines for the week as a whole, declining by 1.6 percent from its opening price on Monday. Despite the declines, investors will be glad that Europe’s most influential index has not been anywhere near as volatile as its Japanese counterpart.
The FTSE had risen to 6335.60 at 3:30pm local time, however with worse than expected data from the US on its industrial sector the index slumped in the last hour of trading from its gains of 0.6 percent for the day.
Glencore Xstrata lead the index in declines with an advance of 9.80 points, or 3.20 percent, closing at 315.90 on the back of the news that former Morgan Stanley chief, John Mack, had joined their board of directors on Wednesday and positive signs for the newly merged mining outfit. The company have struck a deal which gives them access to a $17bn revolving credit facility, a signal of great faith in the company from creditors — especially with miners generally registering heavy declines so far this year.
Meanwhile at the other end of the scale, Severn Trent continued their declines with a loss of 25.00 points, or 1.40 percent, closing at 680.10. The water utility has seen their stock plummet by 15 percent this week on the back of a potential takeover in the region of £5.3bn falling through as the deadline passed without an agreement being made.