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FTSE gains as UK mining index hits one-month high

Mon, 06th Jun 2016 15:49

(ADVISORY- Reuters plans to replace intra-day European and UKstock market reports with a Live Markets blog on Eikon - see cpurl://apps.cp./cms/?pageId=livemarkets for site in development. See the bottom of the report for moredetails)

* Blue-chip FTSE 100 index gains 1 percent

* Miners track metals prices higher

* Housebuilders hit by Brexit concerns

* Indivior falls on downgrade - trader

By Kit Rees and Atul Prakash

LONDON, June 6 (Reuters) - Britain's top share index climbedon Monday, with a rally in metals prices boosting the UK miningindex to a one-month high, although housebuilders fell onconcerns surrounding the June 23 referendum on the country's EUmembership.

The commodity-heavy FTSE 100 index was up 1 percentat 6,273.40 points by the close, outperforming the broaderEuropean market.

The UK mining index rose 6.5 percent to itshighest level since early May as prices of major industrialmetals advanced after a fall in the U.S. currency, makingdollar-priced commodities cheaper for holders of othercurrencies.

"Mining stocks are topping the FTSE 100 as the commoditiesspace benefits from a weaker U.S. dollar basket. The currency'sreversal of recent strength comes in response to Friday'ssurprisingly weak May U.S. jobs report," Mike van Dulken, headof research at Accendo Markets, said.

Miners Anglo American, Rio Tinto, BHPBilliton, Antofagasta and Glencore allrallied by between 5 percent and 11.1 percent.

Among the top fallers, however, British housebuilding stocksPersimmon, Barratt Developments and TaylorWimpey all fell by 1.1 percent to 1.6 percent after twoopinion polls showed that Britain's "Out" campaign to leave theEuropean Union was in the lead.

Brexit-related concerns saw the domestically-focused FTSE250 underperform, as it rose only 0.7 percent.

"We're in the final stages of the Brexit debate now, andanything with a strong UK exposure is starting to come under abit of pressure from traders that are looking at stocks...thatwill see significant downside if there is a vote to leave theEU," Jonathan Roy, advisory investment manager at CharlesHanover Investments, said.

Pharmaceuticals company Indivior fell more than 10percent with a trader citing a broker downgrade on the stock.Indivior had risen over 36 percent on Friday after winning apatent ruling on its main product, heroin substitute SuboxoneFilm.

ADVISORY- Reuters plans to replace intra-day European and UKstock market reports with a Live Markets blog on Eikon (see cpurl://apps.cp./cms/?pageId=livemarkets for site in development). In a real-time, multimedia formatfrom 0600 London time through the 1630 closing bell, it willinclude the best of our market reporting, Stocks Buzz service,Eikon graphics, Reuters pictures, eye-catching research andmarket zeitgeist. Breaking news and dramatic market moves willcontinue to be alerted to all clients and we will continue toprovide a short opening story and comprehensive closing reports.

If you have any thoughts, suggestions orfeedback on this, please email mike.dolan@thomsonreuters.com.

Mike Dolan, Markets Editor EMEA. (Editing by Hugh Lawson)

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