Sector movers: Miners mount recovery, Sage slips
Miners were the main driving force on London markets on Monday, boosted by rising metals prices.
Copper found some traction after a drop last week, while oil and gold were also stronger.
"London copper regained following last weeks’ broad sell-off as hopes towards progress in a trade dispute between the United States and China buoyed risk appetite and undermined safe-haven demand for the dollar," said broker SP Angel.
Analysts said copper was up as the dollar sagged on receding investor demand, and a focus on discussions between the world’s top two economies are due this week.
BHP Billiton, Glencore, Anglo American and Antofagasta were all higher as copper prices rose, though were outdone by Russia-based steelmaker Evraz, rallying after a sell-off earlier in the month sparked by worries about US sanctions on Russia.
The most-watched event this week is likely to be the low-level US-China trade talks starting on Tuesday, IG market analyst Joshua Mahony, just before $16bn in new US tariffs on Chinese goods take effect.
"Markets often find it difficult to focus on one topic, and thus with the focus now shifting away from Turkey and towards China, it comes as no surprise that the pessimism of last week is fading into obscurity," Mahony said.
A trade delegation from China will travel to meet with US counterparts for two days of talks, with Mahony saying that as long as there is hope for some form of breakthrough, markets are likely to be in a more optimistic mood.
"However, this optimism is likely to be ill-founded, for all the previous meeting have shown precious few signs of anything that looks like a breakthrough."
The tech sector was lower, dragged down by software developer Sage Group, which was downgraded by Deutsche Bank to 'sell' from 'hold'. Analysts felt the competitive situation the FTSE 100 group's core mid-market franchise was worsening, cutting the price target to 540p from 630p.
Having spoken to a number of accountants and resellers over the last few weeks across the UK, US and Australia, analysts said: "Entry level players at far lower price points are moving upmarket and are building functionality either internally or through third party platform partners. Higher end competitors also appear to be gradually gaining share from Sage's core user and reseller base."
Top performing sectors so far today
Industrial Metals & Mining 4,300.36 +2.41%
Forestry & Paper 24,012.24 +1.62%
Industrial Engineering 13,211.03 +1.09%
Construction & Materials 6,375.47 +1.05%
General Industrials 6,868.31 +0.87%
Bottom performing sectors so far today
Software & Computer Services 1,824.78 -2.33%
Gas, Water & Multiutilities 4,963.57 -0.25%
Electricity 7,617.32 -0.21%
Insurance (non-life) 3,259.54 -0.11%
General Retailers 2,394.89 -0.08%