* FTSE up 0.7 percent
* Commodities rise as G20 agreement sends dollar lower
* Burberry rallies after LVMH takes stake in Hermes
By David Brett
LONDON, Oct 25 (Reuters) - Commodity stocks lifted Britain's
top shares on Monday as the dollar weakened after G20 finance
ministers agreed to avoid competitive currency devaluations and
ahead of a speech by U.S. Federal Reserve Chairman Ben Bernanke.
By 1054 GMT, the FTSE 100 <> was up 38.44 points or 0.7
percent at 5,779.81, having closed down 0.3 percent at 5,741.37
in the previous session.
Technical factors also supported FTSE gains, analysts said.
"The positive aspects are that the index remains above its
20-period moving average," Sandy Jadeja, chief technical analyst
at City Index, said.
"Longer-term price action suggests that a thrust above 5,833
could take the index towards 6,050-6,097."
The FTSE mining index <.FTNMX1770> gained 2.7 percent as
copper prices <CMCU3> rose to a 27-month high after the dollar
suffered another setback following the weekend G20 meeting of
finance ministers. []
Chilean copper miner Antofagasta <ANTO.L> was the top FTSE
riser, up 4.3 percent, helped by an upgrade from Goldman Sachs,
which raised its rating to "buy" from "neutral".
Oil majors also traded higher along with crude <CLc1>, which
rose over 1 percent. BP <BP.L> added 0.7 percent and Royal Dutch
Shell <RDSa.L> climbed 0.5 percent.
U.S. stock index futures pointed to a higher open on Wall
Street as investors awaited comments from Bernanke at 1230 GMT
that could shed light on the Fed's monetary easing move.
"For those investors prepared to take slightly more of a
risk chasing yields (with interest rates remaining low),
equities seem the asset class of choice," said Richard Hunter,
head of equities at Hargreaves Lansdown.
LUXURY GOODS
Burberry <BRBY.L> rose 3.6 percent as investors speculated
that LVMH's <LVMH.PA> purchase of a minority stake in handbag
maker Hermes <HRMS.PA> may spark bid interest in the luxury
goods sector. []
"Midcap luxury stocks such as Bulgari <BULG.MI>, Burberry
<BRBY.L> or Tod's <TOD.MI> could benefit from LVMH's move, as it
might signal renewed M&A activity in the sector," Citi analysts
said in a note.
Frankfurt stock market operator Deutsche Boerse <DB1Gn.DE>
and the London Stock Exchange <LSE.L> advanced 0.9 and 5.2
percent, respectively, after Singapore Exchange's <SGXL.SI>
A$8.4 billion ($8.23 billion) takeover bid for ASX Ltd <ASX.AX>
signalled industry consolidation may heat up again.
[]
InterContinental Hotel Group <IHG.L>, the world's top
hotelier, rose 1.6 percent after a bullish third-quarter update
from their American operations. []
Banks, however, lagged the wider market rally, weighed down
mainly by Lloyds Banking Group <LLOY.L>, which fell 3 percent
after Credit Suisse cut its target price for the British
state-backed bank.
Credit Suisse said in a research note that falling property
prices could have a negative impact on Lloyds and that prospects
for near-term capital return from the bank are limited.
Pearson <PSON.L> fell 1.1 percent. The publishing group
raised its full-year outlook again, saying it now expected
adjusted earnings per share to be up 10 percent due to growth in
its U.S. College and Financial Times units.
Numis, which kept its bullish stance on Pearson, said in a
note that "directionally the update is as expected".
Invensys <ISYS.L> shed 1.4 percent as UBS cuts its rating to
"neutral" from "buy" in a sector review.
(Editing by Michael Shields)
