By Carla Mozee, MarketWatch
LONDON (MarketWatch) -- The U.K.'s benchmark FTSE 100 climbed to
a record closing high Tuesday, aided by a surge in shares of mining
heavyweight BHP Billiton PLC, as investors appeared to embrace the
U.S. central bank's view on interest rates, and the Greek debt saga
that appeared to be wrapping up.
The FTSE 100 closed up 0.5% at 6,949.63 after spending much of
the session swaying between small losses and gains. The benchmark
surpassed a previous all-time closing high of 6,930.20 notched on
Dec. 30, 1999.
Stocks rose to intraday highs in afternoon trade as eurozone
finance officials approved Greece's bailout extension
(http://www.marketwatch.com/story/greek-stocks-bonds-rally-on-bailout-deal-optimism-2015-02-24).
Around the same time, U.S. Federal Reserve Chairwoman Janet Yellen,
in prepared remarks for testimony before Congress, said the bank's
interest rate-setting committee "considers it unlikely that
economic conditions will warrant an increase in the target range
for the federal funds rate for at least the next couple of FOMC
meetings." Read live blog of Yellen's testimony
(http://blogs.marketwatch.com/capitolreport/2015/02/24/live-blog-and-video-of-janet-yellens-first-day-of-testimony-before-congress/).
Remarks read as dovish in U.S. markets.
U.K. stocks made minor moves during testimony by Bank of England
Governor Mark Carney at a Treasury Select Committee in London.
Carney, in backing the bank's recent quarterly inflation report,
said he expects the level of U.K. inflation to rise back to the
government's mandated target of 2%. The pound (GBPUSD) traded at
$1.5451 late Tuesday compared with $1.5457 late Monday.
Standing out among equity advancers was BHP Billiton (BHP) . Its
stock climbed 6.2% after the miner, the biggest by market value,
reported a lower-than-anticipated fall in first-half profit, which
was $4.27 billion
(http://www.marketwatch.com/story/bhp-profit-falls-as-commodity-prices-slide-2015-02-24).
Analysts polled by The Wall Street Journal had expected profit, on
average, to come in at $3.59 billion.
"Cost reduction ahead of full-year guidance, strong free cash
flows and further rationalisation of capex were all positives,"
said Barclays analyst Ephrem Ravi in a note, adding that it's
maintaining its overweight rating on BHP.
In a move by BHP to "keep shareholders happy the interim
dividend was boosted by 5%," said David Madden, market analyst at
IG, in a note. "The ability of the company to produce a strong set
of numbers during a testing time for the commodities industry is
why the market has so much confidence in BHP Billiton." The interim
dividend would be raised to 62 cents a share.
Other mining stocks marched to the top of the FTSE 100. Anglo
American PLC climbed 3.3%, Fresnillo PLC gained 3.1%, and
Antofagasta PLC rose 3%.
Also a big gainer in the benchmark, shares of Mondi PLC popped
2.6%. The packaging and paper company said it's recommending a 17%
increase in its dividend
(http://www.marketwatch.com/story/mondi-profit-rises-recommends-dividend-increase-2015-02-24)after
a rise in 2014 profit to 471 million euros ($534.6 million), from
EUR386 million a year earlier.
Meanwhile, Diageo PLC shares gained 1.2% as Berenberg
reinitiated coverage on the beverage maker with a buy rating.
But at the lower end of the FTSE was Vodafone PLC , with shares
of the mobile-services provider falling 2.6% after a ratings
downgrade to underperform from neutral at Bank of America Merilll
Lynch.
Shares of Meggitt PLC fell 6% as the aerospace, defense and
energy group posted a 22% decline in pretax profit to GBP208.9
million
(http://www.marketwatch.com/story/meggitt-yearly-profit-falls-2015-02-24),
and a 5% revenue decrease to GBP1.55 billion.
GKN PLC shares dropped 3.2% after the engineering firm reported
a fall in full- year sales and pretax profit
(http://www.marketwatch.com/story/gkn-profit-falls-amid-currency-hit-2015-02-24)
due to the impact of currency movements. GKN did say taking out the
impact of currency movements, organic sales rose 4%.
Home builder Persimmon PLC posted a 45% rise in 2014 pretax
profit to GBP467 million, and a 23% rise in sales to GBP2.57
billion. But shares fell in Tuesday's trade, losing 3.5%. The
shares climbed 34% in 2014, and are up 4.6% so far this year.
Persimmon's 2014 results were "solid", wrote Davy equity analyst
Colin Sheridan in a note. "However, with current trading likely to
be uncertain ahead of the U.K. general election, and few
incremental positives from the long-term capital returns program,
we see little reason to become more positive on the stock at this
time," said Sheridan, reiterating its underperform rating on
Persimmon.
(http://www.marketwatch.com/story/what-time-does-draghi-speak-on-tuesday-2015-02-24)
(http://www.marketwatch.com/story/what-time-does-draghi-speak-on-tuesday-2015-02-24)
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