UKX FTSE 100 Index

By Carla Mozee, MarketWatch

U.K. stocks still log a 2.4% weekly loss

U.K. stocks ended sharply higher Friday, recovering from a 3 1/2 year low and marking their best daily gain in about six months, bolstered by a rally in commodities shares.

The FTSE 100 jumped 3.1% to close at 5,702.60. Mining and oil and gas led all sectors higher. The U.K. benchmark marked its best one-day gain since late August, according to FactSet data.

"London's FTSE 100 is positively flying," Tony Cross, market analyst at Trustnet Direct, wrote in a note.

However, Friday's advances pared the stock gauge's weekly losses only slightly, leaving it down 2.4% for the week. So far this year, the index has lost 8.6%. In 2015, it dropped 4.9%.

Iron ore and platinum producer Anglo American PLC (AAL.LN) leapt 19%, and commodities miner and trader Glencore PLC (GLEN.LN) jumped 12.3%. Oil major BP PLC (BP.LN) (BP.LN) gained 7.2%.

Thursday's slide of 2.4% (http://www.marketwatch.com/story/ftse-100-dragged-down-by-miners-after-rio-tinto-swings-to-loss-2016-02-11) left the index at its lowest since July 2012, FactSet data show. That selloff tracked a global rout in stocks, prompted by concerns about the health of banks and the persistent weakness in oil prices.

On Friday, oil was "working its way a little higher off recent lows, which will be helping sentiment for stocks--but critically, the fundamentals haven't changed" said Cross. "As such, this still looks more like bargain hunting than the market turning its back definitively on the run lower."

Oil stocks: Brent crude , the global benchmark, jumped 5% to $31.57 a barrel, and West Texas Intermediate crude climbed more than 4% to $27.35 a barrel as traders moved to cover short positions (http://www.marketwatch.com/story/oil-prices-rally-5-after-more-jawboning-from-opec-members-2016-02-12). Both grades vaulted still higher after the U.K. market closed on Friday.

Tracking those gains, shares of energy giant Royal Dutch Shell PLC (RDSB.LN) (RDSB.LN) closed up 5.6%, while BG Group PLC (BG.LN) finished 4.1% higher.

The United Arab Emirates's energy minister reportedly said late Thursday that OPEC was ready to cooperate on production cuts. But this year has seen similar comments without any output reduction deal materializing.

Other movers: Rolls-Royce Holdings PLC (RR.LN) surged 14.3%, its strongest gain since February 2004. The engine maker, whose clients include Boeing Co. (BA), has slashed its full-year dividend (http://www.marketwatch.com/story/rolls-royce-cuts-dividend-as-yearly-profit-falls-2016-02-12) and left its 2016 forecast unchanged.

"This morning, the CFO has said there is no need for any rights issue, and the decisive action seems to have impressed investors who have been suffering thanks to frequent profit warnings over the last year," Brenda Kelly, London Capital Group's head analyst, said in a note.

Data: The U.K.'s construction output in December rose by an estimated 1.5%, compared with November, according to the Office for National Statistics. The growth rate was expected at 2.2%, according to HSBC.

The pound moved higher to change hands at $1.4558, compared with around $1.4510 ahead of the report. Sterling bought $1.4473 late Thursday.

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(END) Dow Jones Newswires

February 12, 2016 12:35 ET (17:35 GMT)

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