Festive cheer extends FTSE rally

The FTSE 100 Index notched up its sixth session of gains in a row today as the Santa rally showed no signs of running out of steam.

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The FTSE 100 rose in a sixth straight session of gains, up 31 points to 6725

The FTSE 100 Index notched up its sixth session of gains in a row today as the Santa rally showed no signs of running out of steam.

Traders returned from their two-day festive break to market cheer on both sides of the Atlantic thanks to more optimism over the US and UK economy.

London's top tier closed 56.7 points higher at 6750.9 - close to its 2013 high of 6840, which was notched up in May and putting the all-time record of 6930.2 reached on December 30 1999 within reaching distance once more.

Sentiment was boosted by a record overnight close on Wall Street - which resumed trading after Christmas yesterday - and the Dow Jones Industrial Average was holding on to the gains today at the time of close in London.

The Dow was spurred on yesterday by a n unexpectedly large drop in claims for unemployment benefits last week, which provided the latest sign that the US jobs market is improving.

Trading in London has also been buoyed in recent weeks by hopes of a decent 2014 for the economy, driven by last week's upward revisions to growth figures in both the US and UK, as well as the removal of uncertainty after the Federal Reserve's recent announcement on tapering of its bond buying programme.

Strong advances for mining stocks added to the festive share surge in thin trading volumes, with commodity stocks helped higher after China moved to head off a credit crunch and as figures estimated strong industrial output over 2013.

In the currency markets, the pound hit its highest level in nearly two-and-a-half years against the US dollar thanks to Britain's brighter recovery prospects.

Sterling rose 0.5% to 1.65 dollars - a level not seen since August 2011 - and largely held firm at 1.20 euros.

Among stocks, miners were leading the session's gains after China said its industrial output was likely to have grown by 9.8% in 2013, boosting hopes for demand from the world's second biggest economy.

It also pumped more cash into the interbank lending market to help drive down borrowing costs for Chinese banks.

Silver miner Fresnillo led gains, up 25.5p to 735p.

Retailers and banking stocks were also in favour, with Barclays shrugging off its latest fine, up 4.3p to 269.7p despite being hit with a 3.8 million US dollar (£2.3 million) penalty yesterday by US regulators for failing to keep electronic records properly.

Supermarkets were likewise making advances amid hopes of a buoyant Christmas for the sector, with Sainsbury's ahead 6.6p to 378.4p and Morrisons up 3.9p to 267.7p.

Elsewhere, regional newspaper group Johnston Press was sent higher after announcing a temporary reprieve from its bankers ahead of talks to secure financing next year.

The owner of the Yorkshire Post and The Scotsman gained 10%, up 1.5p to 16p.

The biggest FTSE 100 risers were Fresnillo up 25.5p to 735p, Hargreaves Lansdown ahead 44p to 1349p, Antofagasta 25.5p higher at 830.5p and Anglo American 34p stronger at 1309.5p

The biggest FTSE 100 fallers were Land Securities down 7p to 955p, Old Mutual off 1.4p to 191.4p, Kingfisher 1.9p lower at 385.1p and Hammerson 2p weaker at 500p.