KAZ, XTA lead miners higher

European equities markets saw gains Wednesday on better news than expected form the UK and US services sectors.

The Chartered Institute of Purchasing and Supply reported that its services index was up to 42.5 in January from 40.2 in December, a sign that contraction in the sector is slowing, while in the US the Institute for Supply Management services index came in at 42.9 in January from 40.1 in December to show a slight reduction in contraction in the SU sector as well.

In London the FTSE 100 added 1.54 percent to 4,228.6 while the FTSE 250 gained 3.12 percent to 6,321.81.

Miners took four of the top five spots on the gainers list on the 100, with Antofagasta (LSE: ANTO) up 12.7 percent as Eurasian Natural Resources Corporation (LSE: ENRC) added 14.38 percent, Xstrata (LSE: XTA) was 14.75 percent higher and Kazakhmys (LSE: KAZ) gained 14.86 percent for the best performance of the day on the 100.

Eurasian’s gains came even though its production dropped 22 percent in the fourth quarter and it repeated a disappointing outlook.

Gains in the mining sector came after BHP Billiton (LSE: BLT; ASX: BHP; NYSE: BHP) said that profits were up 2.2 percent in the first half of its fiscal year.

The tobacco sector declined after Philip Morris (NYSE: PM) issued an outlook worse than expected by Wall Street, with Imperial Tobacco Group (LSE: IMT) down 2.45 percent while British American Tobacco (LSE: BATS) dropped 3.13 percent.

The FTSE Eurofirst 300 was up 2.37 percent to 810.66 as the IBEX added 1.6 percent to 8,495.4, the Dax was 2.69 percent higher to 4,492.79 and the CAC-40 gained 2.9 percent to 3,068.99.

Steelmakers turned in the best performances of the day on both the Dax and the CAC-40 as ThyssenKrupp (FWB: TKA; LSE: THK) added 9.17 percent and ArcelorMittal (Euronext: MT; NYSE: MT; BMAD: MTS; LuxSe: MT) gained 10.16 percent.

Carmakers were also higher on the session as Renault (Euronext: RNO) added 5.52 percent, BMW (FWB: BMW) was up 6.22 percent, Peugeot (Euronext: UG) was 6.82 percent higher and truck maker Man (FWB: EDF1) gained 8.42 percent.

Only two companies lost ground on the CAC-40 as drug maker Sanofi-Aventis (Euronext: SAN; NYSE: SAN) dropped 0.04 percent and France Telecom (Euronext: FTE; NYSE: FTE) was 0.7 percent lower on the session.

Most markets in the Asia-Pacific region were higher on the session.

In Tokyo, the Nikkei 225 was up 2.73 percent to 8,038.94 while the Topix index added 2.45 percent to 792.78 and the Mothers market gained 1 percent to 338.93.

Japanese shippers and manufacturers of heavy construction machinery saw gains on the possibility that China’s economy could be on the mend.

In the shipping sector Mitsui OSK Lines (TYO: 9104) was up 3.9 percent while Kawasaki Kisen (TYO: 9107) added 4 percent, while heavy machinery maker Komatsu (TYO: 6301) was 6.3 percent higher and Hitachi Construction (TYO: 6305) gained 9.4 percent.

Carmakers also saw gains as the yen weakened, with Toyota (TYO: 7203; NYSE: TM; LSE: TYT) up 4.5 percent as Honda (TYO: 7267; NYSE: HMC) gained 6.3 percent.

The Taiex was up 0.39 percent to 4,389.97, the Sensex added 0.57 percent to 9,201.85, the Hang Seng was 2.25 percent higher to 13,063.89, the Shanghai Composite was up 2.28 percent to 2,107.75 and the Kospi gained 2.77 percent to 1,195.37.

Not all markets in the region saw gains, however, with the Straits Time Index dropping 0.26 percent to 1,707.39 while in Australia the Sydney Ordinaries fell 1.94 percent to 3,382.3 and the S&P/ASX200 was down 2.02 percent to 3,437.9.

In early afternoon trade on Wall Street the Dow Jones Industrial Average was down 0.4 percent to 8,046.42 while the Nasdaq Composite had added 1.04 percent to 1,532.14 and the S&P 500 was up 0.29 percent to 840.93.

Some banks saw gains after US President Barack Obama put a cap of $500,000 on how much senior bank executives at institutions receiving bailout money from the government may make in a year and ahead of an announcement due next week on how the last $350 billion of last year’s bailout money voted by Congress will be spent.

At just before 2 p.m. in New York JPMorgan Chase (NYSE: JPM) was up 0.17 percent, Citigroup (NYSE: C) had added 2.02 percent and Goldman Sachs (NYSE: GS) had gained 4.79 percent, but Bank of America (NYSE: BAC) was down 10 percent.

Story link: KAZ, XTA lead miners higher