Petropavlovsk leads miners, London markets

| October 6, 2009 | 0 Comments
Petropavlovsk leads miners, London markets

European equities markets were higher Tuesday, led by miners after a surge in gold prices to record levels in New York after the US dollar weakened in response to reports in the British newspaper the Independent that several oil-producing nations, including China, France, Russia and Japan have been engaged in secret talks toward ending dollar-based trade of oil.

The greenback weakened and the price of gold rose to $1,045 per troy ounce in New York trade even though the governments said to be involved in the talks denied that any meetings were going on.

The FTSE 100 added 2.22 percent to 5,135.8 in London, while the FTSE 250 gained 2.36 percent to 9,194.58.

Gold miners led both the 100 and 250 as gold producer Petropavlovsk (LSE: POG), which operates in Russia, added 16.12 percent to lead all miners and the 250, and Mexican gold and silver miner Fresnillo (LSE: FRES) topped the 100 with a gain of 9.93 percent.

Other miners also saw big gains, including Vedanta Resources (LSE: VED) which added 9.1 percent, while Kazakhmys (LSE: KAZ) was up 9.08 percent and Randgold Resources (LSE: RRS; NAS: GOLD) was 8.04 percent higher, all on the 100.

Over on the 250, Hochschild Mining (LSE: HOC) was up 9.63 percent and iron ore producer Ferrexpo (LSE: FXPO) gained 9.51 percent.

The FTSE Eurofirst 300 was up 2.16 percent to 992.15 while the IBEX added 2.25 percent to 11,817.1, the CAC-40 was 2.43 percent to 3,764.47 and the Dax gained 2.59 percent to 5,651.42.

Banks led both the CAC-40 and the Dax as Credit Agricole (Euronext: ACA) gained 7.83 percent on the Paris exchange and Commerzbank (LSE: CBK) added 5.97 percent to lead the Frankfurt index.

There were only two losers each on the Dax and the CAC-40.

Markets in the Asia-Pacific region were mostly higher on optimism spurred by new data showing that the US services sector expanded for the first time in a year last month.

The major exception to the gains was South Korea’s Kospi, which dropped 0.53 percent to 1,598.44 on the session.

The Nikkei 225 was up 0.18 percent to 9,691.8 in Tokyo, while the Topix index added 0.5 percent to 871.63 and the Mothers market gained 2.47 percent to 421.36.

In addition to the US services sector data, gains came on comments from Japan’s Financial Services Minister who assured that Japanese banks will not have to increase provisions to cover bad loans even if small businesses postpone repayments under a program he has proposed.

The real estate sector was also higher, seeing gains after declines since the new government gook over in mid-September, but electricity utilities and mobile-phone operators were lower in Tokyo.

Australian markets were higher as the Sydney Ordinaries added 0.39 percent to 4,597.2 and the S&P/ASX200 was up 0.4 percent to 4,591.6.

The Sensex was 0.55 percent higher to 16,958.54 while the Straits Times Index added 1.09 percent to 2,611.89, the Taiex was up 1.32 percent to 7,536.05 and the Hang Seng gained 1.87 percent to 20,811.53.

China’s markets remained closed in observance of holidays.

At midday in New York, the Dow Jones Industrial Average was up 1.6 percent to 9,753.39 while at the same time the Nasdaq Composite had added 1.84 percent to 2,106.17 and the S&P 500 was 1.7 percent higher to 1,058.19.

Prices for oil, as well as for gold and other precious metals, were higher in afternoon trade in New York.

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