UK stocks : FTSE 100 adds 0.4 pct
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UK stock closing: Britain's leading share index rose on Tuesday, led by gains in risk-sensitive commodity issues on signs of progress towards a political compromise on the U.S. "fiscal cliff".
The FTSE 100 closed up 23.75 points, or 0.4 percent, at 5,935.90 but failed to hold above last week's 9-month closing peak of 5,945.85 which was within 20 points of its 2012 high.
"Having recommenced its residency above 5,900, the question is now whether the FTSE 100 can muster the enthusiasm to push towards the next big level of 6,000," Chris Beauchamp, Market Analyst at IG said in a note.
The mid cap FTSE 250 index, however, hit a life-time closing high at 12,293.25 after registering a 0.6 percent gain. U.S. blue chips were 0.6 percent higher by London's close as investors speculated that negotiations between Democrats and Republicans would lead to a deal to avert the fiscal cliff - a package of tax cuts and austerity measures which could push the U.S. economy back into recession.
Republican House Speaker John Boehner said he has hope for a broader deal on the budget talks and was still talking with President Barack Obama.
Gains by miners and energy issues provided half of the FTSE 100 index's points advance on the view that demand for commodities will recover once the U.S. budget standoff is resolved.
"Traders are beginning to come around to the idea that the past month has been more about a steady uptrend in risk asset prices, more so than a period to position against the impending fiscal cliff," said David White, Financials Trader at Spreadex.
"What investors must consider carefully, however, is how the market will react to the news. The extent by which the market jumps higher on any firm deal will likely be in part a function of recent performance, potentially dampening any upside with an already optimistic market," White added.
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