U.K. Stocks Rise, Led by Energy, Mining Shares; Logica Soars

By Adam Haigh

Aug. 14 (Bloomberg) -- U.K. stocks rose the most in more than a week, led by commodity producers as higher oil and metals prices buoyed the earnings outlook for energy and mining companies.

Rio Tinto Group, Royal Dutch Shell Plc and BP Plc, which account for more than 20 percent of the benchmark FTSE 100 Index, led the gains. Investors said funds are being switched from financial stocks to raw-material producers. Logica Plc, the Anglo-Dutch computer-services provider, gained the most since September 2003 on an increased full-year sales forecast.

The FTSE 100 added 67.8, or 1.2 percent, to 5,516.4 at 12:28 p.m. in London, heading for its steepest climb since Aug. 5. The FTSE All-Share Index gained 1.1 percent and Ireland's ISEQ Index increased 1.2 percent.

``There has been a move from banks into the miners recently,'' said Keith Bowman, an equities analyst at Hargreaves Lansdown Stockbrokers in London. ``The broad perspective is that there is still growth in the industry and the longer term uptrend remains strong.''

Rio Tinto Group added 5 percent to 4,888 pence. The company has led the slump among the three biggest U.K.-traded metals producers from their May 19 highs as commodity prices tumbled more than 20 percent, the common definition of a bear market. Shares of the world's third-biggest mining company trade at 15.8 times earnings, the lowest since January.

BHP Billiton, the world's largest mining producer, gained 5.1 percent to 1,589 pence. Copper, lead, tin and zinc prices climbed in London.

Logica Surges

BP, Europe's second-largest oil producer, added 1.4 percent to 532 pence. Shell, the biggest, rose 2.9 percent to 1,860 pence. Crude traded more than $1 per barrel higher than at the close of the U.K. market yesterday. A U.S. Energy Department report yesterday showed a bigger-than-forecast decline in inventories of gasoline as refiners shut units and imports fell.

Logica soared 11 percent to 124.5 pence after saying it was increasing its sales forecast because of ``robust'' customer spending.

The following stocks also rose or fell in the U.K. and Irish markets. Stock symbols are in parentheses.

Bellway Plc (BWY LN) lost 9.5 pence, or 1.7 percent, to 567. The homebuilder said full-year sales fell 14 percent as banks granted fewer mortgages during the U.K.'s most widespread housing slump in three decades.

Protherics Plc (PTI LN) soared 13.5 pence, or 35 percent, to 51.75 after saying ``a number of parties'' have made takeover approaches for the U.K. biotechnology company.

Psion Plc (PON LN) lost 2.5 pence, or 2.7 percent, to 88.75. The maker of the Ikon wireless telephone reported a 26 percent fall in first-half profit on higher distribution and administrative expenses.

Irish companies:

Smurfit Kappa Group Plc (SKG ID) slid 32.4 cents, or 7.1 percent, to 4.23 euros. UBS AG added Europe's largest maker of cardboard boxes to its ``least preferred'' list of paper and forestry stocks, citing a weakening outlook for selling prices.

To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net