By Alexis Xydias
Sept. 4 (Bloomberg) -- U.K. stocks gained, led by mining companies amid optimism that an economic rebound will feed demand for metals.
Kazakhmys Plc, Kazakhstan’s largest copper producer, jumped 4.3 percent and Lonmin Plc, the world’s third-biggest platinum producer, rose 4.7 percent as analysts advised buying the shares.
The FTSE 100 Index rose 40.19, or 0.8 percent, to 4,836.94 as of 9:03 a.m. in London, paring the decline so far this week to 1.5 percent. The FTSE All-Share Index added 0.8 percent today and Ireland’s ISEQ Index climbed 0.7 percent.
The FTSE 100 has rebounded 38 percent from a six-year low on March 3, on expectations the worst of a global recession is past. Goldman Sachs Group Inc. strategists today raised their forecast for stock gains in Europe this year, citing upgrades to economic and earnings growth forecasts.
“While we agree that the market tends to make its strongest returns while the economy is still contracting, albeit at a slowing rate, it tends to make further gains as the economy begins to expand,” a team of London-based strategists at the U.S. bank wrote in a report.
Kazakhmys rose 4.3 percent to 989 pence. The stock was upgraded to “overweight” from “equal-weight” at Morgan Stanley, which raised its price estimate to 1,380 pence from 833 pence.
Lonmin increased 4.7 percent to 1,509 pence. The shares were raised to “outperform” from “underperform” by Exane BNP Paribas, which cited the possibility that Xstrata Plc may bid for the company.
Elan Corp. dropped 3.9 percent to 4.95 euros. The Irish drugs company breached a contract with Biogen Idec Inc. by entering into a transaction with Johnson & Johnson, a U.S. judge ruled today after a court hearing. Elan had asked the court to rule that it didn’t violate its marketing agreement with Biogen on the multiple sclerosis drug Tysabri in allowing J&J to buy a minority stake in Elan.
To contact the reporter on this story: Alexis Xydias in London at at axydias@bloomberg.net.
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