LONDON MARKETS: FTSE 100 Marks Record As Resource Shares Gain

By Carla Mozee, MarketWatch

Carnival downgraded

LONDON (MarketWatch) -- The U.K.'s FTSE 100 finished at a record close Monday, as resource shares improved.

The benchmark FTSE 100 turned up 0.2% to 7,037.67, with Standard Chartered PLC topping the benchmark.

Standard Chartered rallied 6.5% as Citi raised its price target on shares of the Asia-focused lender to GBP13 from GBP12.50, and said the recent appointment of Bill Winters as the company's chief executive (http://www.marketwatch.com/story/standard-chartered-names-bill-winters-next-ceo-as-it-shakes-up-top-brass-2015-02-26) "puts the spotlight back on an unloved stock." Value at Standard Chartered "can be unlocked" by prioritizing costs, credits and capital, among other factors, said Citi analysts.

The mining group had been in the red earlier in the session, but found support as prices for some metals, including copper, platinum and gold, shed losses. Shares of iron ore heavyweight BHP Billiton PLC climbed 3.4%, Glencore PLC rose 2.6% and Anglo American PLC switched higher, trading up 1.2%.

Meanwhile, shares of oil producer Royal Dutch Shell PLC picked up 2% and BG Group PLC rose 0.7% as oil prices (http://www.marketwatch.com/story/oil-prices-fall-after-saudis-vow-not-to-blink-on-production-cuts-2015-03-23)(CLK5) reversed losses. But oil major BP PLC lagged behind, losing 0.7%.

Also, energy engineering firm Weir Group PLC fell 2.2%, nearly wiping out last week's 3% gain. RBC Capital Markets on Monday lowered its view on Weir to sector perform from top pick.

A rally in energy and mining shares on Friday, aided by the impact of a drop in the U.S. dollar (DXY) on dollar-denominated resources, helped push the FTSE 100 to a record-high close of 7,022.51 (http://www.marketwatch.com/story/ftse-100-edges-up-but-on-track-for-best-week-in-two-months-2015-03-20). Friday was the first session in which the blue-chip index rose above 7,000. The dollar on Friday resumed a selloff on expectations that Federal Reserve policy makers would leave interest rates lower for longer. (http://www.marketwatch.com/story/fed-takes-step-to-rate-hike-but-scales-back-intended-pace-2015-03-18)

But investors should "not read too much into the recent new high", said Tom Elliott, international investment strategist at deVere Group, in a note early Monday.

"We are nervous of buying into a rally that is less about improved corporate earnings forecasts, and more about delving into the tea leaves of statements from the U.S. Fed regarding Janet Yellen's use of the word 'patient'," Elliott added.

Meanwhile on Monday, shares of Carnival PLC fell 1.6% after Deutsche Bank cut its rating on the cruise operator to hold from buy. Carnival's first-quarter update is likely to show further bookings and pricing recovery, among other improvements, but significant moves in the euro and the pound could lead to fiscal year 2015 per-share earnings guidance being reduced by about 8%, the bank's analysts said.

Hikma Pharmaceuticals PLC ended unchanged in its first day trading as part of the FTSE 100.

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