FTSE gains as banks, commodities rise

* FTSE 100 up 0.9 percent

* Banks supported after euro zone ministers meet

* Commodity stocks lifted as metal, oil price recovers

By Simon Falush

LONDON, May 18 (BestGrowthStock) – Firmer commodity prices powered
gains in energy and mining stocks early on Tuesday while banks
firmed as risk appetite crept back, pushing Britain’s top shares
higher in early trade on Tuesday.
By 0751 GMT the FTSE 100 (.FTSE: ) was 52.95 points, or 0.9
percent, higher at 5,315.49, after falling 0.3 point on Monday.

Banks gained as fears about the euro zone debt crisis eased
after a meeting of euro zone ministers aimed to iron out
wrinkles in the 750 billion euro ($925 billion) rescue plan
hatched a week ago.

After talks in Brussels, German Finance Minister Wolfgang
Schaeuble and others played down what some officials described
as Franco-German differences over the way the anti-contagion
mechanism would be deployed if countries needed it.
[ID:nLDE64G290]

Barclays (BARC.L: ), HSBC (HSBA.L: ), Royal Bank of Scotland
(RBS.L: ) and Lloyds Banking Group (LLOY.L: ) added 1.1-2.1 percent.

“Investors are now starting to look beyond the immediate
concerns of debt in Europe to a stronger global economy as
demonstrated by strong company results and firmer macro-economic
data, said Steven Bell, director at hedge fund GLC.

“While the European debt is a dark cloud hanging over
markets, the rest of the world looks quite bright,” he said.

“There is a frightening scenario on TV sets, but the
European economy us chugging along quite nicely, and U.S.
consumer spending is growing, so ultimately there is upside for
risk assets.”

Metal prices and crude oil (CLc1: ) gained some ground,
supporting heavyweight miners and energy stocks.

Rio Tinto (RIO.L: ), Xstrata (XTA.L: ), Lonmin (LMI.L: ), Anglo
American (AAL.L: ), Kazakhmys (KAZ.L: ) and BHP Billiton (BLT.L: )
gained 1.7-3.6 percent.

BG Group (BG.L: ), BP (BP.L: ), Royal Dutch Shell (RDSa.L: ),
Tullow Oil (TLW.L: ) and BG Group (BG.L: ) added 0.2-1.2 percent.

INFLATION WATCH

Investors will keep an eye on inflation data released at
0830 GMT for ideas on when interest rates might start to rise.

Economists expect inflation to have nudged up in April,
boosted by higher petrol prices and tax changes — notably for
alcohol and tobacco — in the March budget.

That would force Bank of England Governor Mervyn King to
write an open letter to the government explaining why inflation
is still more than one percentage point above the central bank’s
2 percent target.

British Land (BLND.L: ) was among the top FTSE 100
gainers, up 4.2 percent after the property company posted its
first full-year mark-up in its portfolio since the UK property
bubble burst three years ago.

British Airways (BAY.L: ) gained 2.8 percent after the airline
won a legal bid on Monday to block a threatened five-day strike
by cabin crew members, which had been due to start on Tuesday.

Mobile phone giant Vodafone (VOD.L: ) underperformed, flat,
retreating from initial gains, as investors focused on concern
that its Indian business was hampered by higher spectrum costs
and a price war.

Britain’s largest institutional investors, stung by
accusations they left companies unchecked ahead of the credit
crisis, have created a new body to harangue errant company
boards.

The Institutional Investor Council (IIC) will be launched
under the auspices of the Institutional Shareholders Committee
(ISC), which said on Tuesday the IIC would also look into
day-to-day issues and government policies affecting the sector.
[ID:nLDE64G12K]

Stock Trading

(Reporting by Simon Falush; Editing by Erica Billingham)

FTSE gains as banks, commodities rise