Brixton shares gain after remaining within covenants; insurers gain
U.K. shares moved higher Monday, led by Barclays after the bank said it may sell a major division, with drug stocks and insurers also among the strongest gainers.
Barclays said it's held talks about possibly selling its iShares exchange-traded funds business and that it's also still considering whether to take part in the U.K. government's asset-protection scheme.
Press reports indicated that Barclays hopes to raise as much as 5 billion pounds ($7 billion) from the sale of iShares. If it does decide to take advantage of the U.K. insurance program, the bank is keen to pay cash, rather than surrender a stake in itself to the government. See full story.
Shares in the bank jumped around 20% in early afternoon London trading.
Other banks were also higher, with Lloyds Banking Group up 1.9% and Royal Bank of Scotland up 3.2%.
Shares in HSBC Holdings also gained 4.5% after a report in the South China Morning Post that the bank won't require a government bailout and is unlikely to go back to shareholders for more capital.
The U.K. FTSE 100 Index rose 2.2%, or 82.42 points, to 3,836.10, following a gain of 6.3% for the U.K.'s top index the previous week.
Other major European indexes also posted strong gains Monday as they extended their rally into a second week, while U.S. stock market futures pointed to a positive start on Wall Street. See Europe Markets See Indications.
Insurance stocks were also higher Monday after a strong performance in the previous week, with Prudential (UK:PRU: news , chart , profile ) up 8.3% and Old Mutual (UK:OML: news , chart , profile ) gaining 2.2%.
Drug makers AstraZeneca (UK:AZN: news , chart , profile ) and GlaxoSmithKline (UK:GSK: news , chart , profile ) both gained around 4%.
Commodity stocks were mixed as oil and metal prices moved mostly lower. OPEC over the weekend decided not to cut production quotas. fell 0.4% and miner Kazakhmys (UK:KAZ: news , chart , profile ) lost 1.4%.
Shares in Rio Tinto (UK:RIO: news , chart , profile ) (RTP:
118.01, +0.21, +0.2%) edged lower after Australia's government extended a review of Aluminum Corp. of China's proposed $19.5 billion investment in the group.
The deal would give Rio a much-needed cash injection, but would also see state-controlled Chinalco's gain a much bigger interest in Rio.
Outside the top index, shares in real estate investment trust Brixton Plc (UK:BXTN: news , chart , profile ) jumped more than 17% after the group said it's exploring all options to strengthen its balance sheet, including sales or an equity raising, but that it remains compliant with its banking covenants.
Simon Kennedy is the City correspondent for MarketWatch in London.
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edged lower after Australia's government extended a review of Aluminum Corp. of China's proposed $19.5 billion investment in the group.
The deal would give Rio a much-needed cash injection, but would also see state-controlled Chinalco's gain a much bigger interest in Rio.
Outside the top index, shares in real estate investment trust Brixton Plc (UK:BXTN: news , chart , profile ) jumped more than 17% after the group said it's exploring all options to strengthen its balance sheet, including sales or an equity raising, but that it remains compliant with its banking covenants.
