By Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch) -- London stocks rose on Friday as
investors basked in the afterglow of a statement by the Bank of
England that many read as confirmation of a continuing easy
monetary stance, and as Goldman Sachs put a year-end target of
7,100 on the FTSE 100.
But gains were not as pronounced as the day prior, as investors
awaited key U.S. nonfarm payroll data. The FTSE 100 index logged
its best one-day and percentage gains since autumn 2011, rising 3%,
or 191.80 points, to 6,421.67.
On Friday, the index was up 0.4% to 6,445.62, as several miners
stepped back from lofty prior-day gains. Shares of Rio Tinto PLC
(RIO) fell 1.8%, BHP Billiton PLC (BHP) declined 1.6% and Glencore
Xstrata PLC dropped 2.8%. Shares of Randgold Resources Ltd. fell
1.5% even as Nomura lifted shares to neutral from reduce.
Shares of Whitbread PLC fell over 3% after UBS strategists cut
shares to neutral from buy, after an investment day. "While we view
the new brand and international expansion plans positively, we do
not think these initiatives change the near-term outlook," said
Jarrod Castle, analyst at UBS.
On the upside, GlaxoSmithKline PLC (GSK) rose 1.2% and Diageo
PLC gained over 1%. Barclays PLC (BCS) was also up over 1%.
Goldman Sachs said in a note on Friday that it was advising
going long U.K. equities and targeting 7,100 for the FTSE 100. The
investment bank gave three reasons for its view: first, the U.K.
economy looks to be on an upswing and second, monetary policy looks
set to ease further, especially after Thursday's dovish statement
from the Bank of England, led by new Governor Mark Carney.
"Third, our forecasts also envisage a gradual stabilization in
euro area growth in the second half of the year. As one of the
U.K.'s largest trading partners, the gradual improvement in growth
here should also be a tailwind for the U.K. economy and U.K.
markets," said economist Noah Weisberger in a note.
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