LONDON (ShareCast) - UK stocks finished Wednesday's session with decent gains, extending its recent winning streak into its sixth day, with investors widely expecting the US Federal Reserve to reveal more stimulus measures in the coming hours.

The Footsie closed at its highest level since March 19th when it finished the session at 5,961.

It is predicted that the Federal Open Market Committee (FOMC) meeting will culminate with the announcement of a new long-term bond purchase programme valued at $45bn per month as 'Operation Twist' comes to an end.

Some 48 out of 49 analysts surveyed by Bloomberg are expecting new stimulus on top of the $40bn monthly mortgage-bond buying programme announced in September, commonly referred to as QE3 (third round of quantitative easing).

While optimism over the 'fiscal cliff' has increased slightly over the last few days, House Speaker John Boehner, who has talked this week with President Barack Obama, said that their two parties still have “serious differences" on resolving the issue.

“His remarks, although not enough to send markets spiral downward, do reinforce the discord between Republicans and the White House. The focus is now on the US Fed’s policy to see if it could provide some joy – due out after the European closing bell,” said market strategist Ishaq Siddiqi from ETX Capital.

Helping provide a lift to sentiment this morning was positive employment data in the UK (jobless claims fell 3,000 in November, better than the 6,000 increase expected), while a bond auction in Italy went relatively ‘smoothly’ in spite of the current political uncertainty.

FTSE 100: Resources lifted by rising metal prices

Resource stocks were leading the way, boosted by rising metal prices and hopes that US law-makers can come to an arrangement over the impending 'fiscal cliff'. Evraz, Tullow Oil, Polymetal International, and ENRC were all making decent gains.

Anglo was also given a lift by Barclays Capital which upped its recommendation for the shares to 'equal weight', while BHP Billiton rose after selling its "non-strategic" interests in the East and West Browse Joint Ventures (JV), offshore Western Australia, for $1.63bn.

Insurers were also performing well, rising in part following a report out yesterday which showed the biggest global insurers are less reliant on short-term funding and not as connected with other financial institutions than the biggest of the large banks. The research was conducted by the Geneva Association, an insurance industry-funded think tank. RSA and Admiral were among the best performers.

Meanwhile, defensive utility stock Severn Trent was heading lower following a strong rise the previous day, as investors' interest turned to riskier assets. Elsewhere, engineering group Babcock was lower after going ex-dividend.

Costa and Premier Inn owner Whitbread was in the red, pulling back after its strong rise yesterday on the back of an in-line third-quarter trading update, in which it revealed that total sales were up 14.4% year-on-year.

FTSE 250: SuperGroup dives as profits plunge

Trendy fashion retailer SuperGroup was a heavy faller on the second-tier index after revealing a 31.5% fall in first-half reported profit before tax (PBT). On an underlying basis though, PBT was up 13.1%. Rik Thakrar, the risk manager and senior dealer at Spread Co, said this morning: "Spread Co clients have approached retail stocks with caution, and Supergroup is no exception in this regard, with a clear 'sell into strength' the apparent strategy of choice for this stock."

Bumi was also taking a hit after saying that it plans to cut ties with the Bakrie family "as soon as practical". Deputy Chairman Julian Horn-Smoth said in a statement: "The independent non-executive directors are continuing to work through a number of very complex issues as quickly as possible with a clear focus on maximizing shareholder value."

Aerospace engineer Senior also gained after saying that positive trading reported in October has continued, with adjusted pre-tax profit in line with expectations in both October and November.



FTSE 100 - Risers
Evraz (EVR) 263.70p +4.52%
Tullow Oil (TLW) 1,182.00p +2.78%
Admiral Group (ADM) 1,146.00p +2.78%
Anglo American (AAL) 1,882.50p +2.70%
Polymetal International (POLY) 1,143.00p +2.42%
G4S (GFS) 255.30p +1.63%
Eurasian Natural Resources Corp. (ENRC) 270.10p +1.50%
Barclays (BARC) 252.60p +1.47%
Associated British Foods (ABF) 1,521.00p +1.40%
RSA Insurance Group (RSA) 124.00p +1.39%

FTSE 100 - Fallers
Morrison (Wm) Supermarkets (MRW) 266.80p -1.19%
Aggreko (AGK) 2,175.00p -1.14%
Whitbread (WTB) 2,461.00p -1.09%
Johnson Matthey (JMAT) 2,433.00p -0.98%
Intertek Group (ITRK) 3,072.00p -0.97%
BT Group (BT.A) 234.90p -0.76%
Amec (AMEC) 1,043.00p -0.76%
Reed Elsevier (REL) 642.00p -0.70%
Hargreaves Lansdown (HL.) 705.00p -0.70%
ARM Holdings (ARM) 759.00p -0.65%

FTSE 250 - Risers
New World Resources A Shares (NWR) 277.00p +13.06%
Ocado Group (OCDO) 78.00p +5.48%
Renishaw (RSW) 1,930.00p +4.66%
Telecity Group (TCY) 867.00p +4.27%
Dignity (DTY) 1,057.00p +3.73%
Hochschild Mining (HOC) 490.00p +3.59%
Phoenix Group Holdings (DI) (PHNX) 540.00p +3.45%
Senior (SNR) 208.50p +3.27%
IG Group Holdings (IGG) 439.60p +2.90%
BH Global Ltd. USD Shares (BHGU) 11.45 +2.78%

FTSE 250 - Fallers
Supergroup (SGP) 557.00p -6.62%
Imagination Technologies Group (IMG) 425.00p -5.22%
Marston's (MARS) 118.80p -4.96%
Bumi (BUMI) 270.80p -4.85%
Ophir Energy (OPHR) 495.00p -4.07%
Savills (SVS) 449.40p -3.35%
Centamin (DI) (CEY) 52.70p -2.68%
Talvivaara Mining Company (TALV) 93.50p -2.65%
Travis Perkins (TPK) 1,066.00p -2.47%
3i Infrastructure (3IN) 123.30p -2.38%

BC

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