* Oils advance, ignoring crude price fall
* Miners rally after dismal 2008
* Banks rise on bargain-hunting
By Jon Hopkins
LONDON, Jan 2 (Reuters) - Britain's leading share index was
up 1.2 percent at midday on Friday, led by strength in miners,
oils, and banks and extending the strong end seen to 2008 into
the first session of 2009.
By 1204 GMT, the FTSE 100 index was up 54.36 points at
4,488.53, just below the session peak of 4,487.86 albeit in very
thin volumes.
"Today is largely irrelevant," said Chris Bennett, senior
trader at binary betting firm ChoiceOdds, "2009 doesn't really
start until Monday, with the City empty and no-one around."
The UK blue chip index closed 41.49 points higher on
Wednesday at 4,434.17, but finished a dismal 2008 with a 31.3
percent decline, the biggest annual fall in its 24-year history.
Commodity issues were in demand again at the start of 2009
having fuelled the last-gasp rally in London at the end of 2008.
Oil issues added the most strength to the FTSE 100 index,
gaining despite crude prices falling on Friday as traders bet a
late-day rally which drove prices up about 14 percent on
Wednesday was overdone.
Shares in Royal Dutch Shell <RDSa.L>, BP <BP.L>, BG Group
<BG.L>, Tullow Oil <TLW.L> and Cairn Energy <CNE.L> gained
between 1.3 and 2.7 percent.
Miners advanced as the sector sought to put the woes of last
year behind it, with Vedanta Resources <VED.L>, Eurasian Natural
Resources <ENRC.L>, Kazakhmys <KAZ.L>, Antofagasta <ANTO.L>,
Xstrata <XTA.L>, Rio Tinto <RIO.L>, and Anglo American <AAL.L>
up between 6.5 and 12.1 percent.
A recovery by hard-pressed banking issues also helped the
blue chips, with HBOS <HBOS.L>, HSBC <HSBA.L>, Royal Bank of
Scotland <RBS.L>, Lloyds TSB <LLOY.L>, and Barclays <BARC.L> all
gaining between 1.6 and 5.1 percent.
Prominent politicians are calling for a ban on short-selling
of financial stocks to be extended by the City watchdog when it
expires in two weeks, the Financial Times said.
Retailers also rallied as John Lewis, the employee-owned
group seen as a barometer of UK retail spending, said on Friday
sales surged at both its department stores and upmarket grocery
chain in the days before and after Christmas.
Marks and Spencer <MKS.L>, which delivers a Christmas
trading statement next week, added 0.4 percent, with Next
<NXT.L> gaining 0.5 percent, Kingfisher up 1.3 percent <NXT.L>,
Sainsbury <SBRY.L> ahead 2.2 percent and Tesco <TSCO.L> up 0.3
percent.
But the downturn in consumer spending will drive over 1,600
British retailers out of business in 2009, triggering thousands
of job losses and leaving more than one in ten shops empty, a
report by market researchers Experian said on Thursday.
Drug stocks were the biggest drag on the FTSE 100, falling
back after strong gains over the last sessions of 2008, with
GlaxoSmithKline <GSK.L> losing 1.9 percent, and AstraZeneca
<AZN.L> down 1.1 percent.
Non-life insurers, also a fairly resilient sector in 2008,
were weak as well, with Amlin <AML.L> off 2.0 percent and
Admiral Group <ADML.L> down 1.8 percent.
Macro news remained grim. British house prices fell by a
recoord 16.2 percent year-on-year in December, taking them to
their lowest level since August 2004, data from the country's
biggest mortgage lender, Halifax, showed on Friday.
Prices fell by a bigger-than-expected 2.2 percent in
December alone, and are now 20 percent below the peak set before
the start of the credit crunch in mid-2007.
(Editing by David Cowell)
