U.K. Stocks Climb on BP Earnings; Mining Companies Rally

Oct. 30 (Bloomberg) -- U.K. stocks advanced the most in two weeks as BP Plc reported earnings that exceeded analysts’ estimates and mining companies rebounded with metal prices.

BP jumped 4.2 percent after Europe’s second-largest oil company also increased its dividend payout. Rio Tinto Group rose 2 percent as copper climbed from an eight-week low. BHP Billiton Ltd. gained 1.8 percent after announcing a plan to expand its Australian iron-ore operations.

The FTSE 100 Index added 54.8 points, or 1 percent, to 5,849.9 at the close in London, its biggest rally since Oct. 16. The benchmark measure fell yesterday as Hurricane Sandy prompted the U.S. to suspend all equity trading. The volume of shares changing hands on the FTSE 100 has been at least 40 percent lower than the 30-day average for the last two days, according to data compiled by Bloomberg.

“We’ve seen strength in the mining companies as well as BP earnings, so you are looking at a good 30 percent of the index moving higher today,” Richard Hunter, head of U.K. equities at Hargreaves Lansdown Plc said in a telephone interview from London. “Stepping back from that, volumes are extremely light. With the U.S. closed for a second day, there is an element of the market that is not taking part. I don’t think today represents a return to risk on.”

The broader FTSE All-Share Index climbed 0.8 percent today, while Ireland’s ISEQ Index gained 1.1 percent. The U.S. canceled stock trading for a second day after Hurricane Sandy struck the east coast.

BP, Shell

BP jumped 4.2 percent to 442.85 pence after the oil company reported an 8 percent increase in third-quarter net income to $5.4 billion as underlying earnings in its refining and marketing unit rose to a record. Adjusted profit of $5.2 billion compared with earnings of $5.5 billion a year earlier. The average analyst estimate in a Bloomberg survey had called for profit of $4 billion on the same basis. BP also raised its dividend by 12.5 percent to 9 cents a share.

Royal Dutch Shell Group Plc, Europe’s biggest oil company, rose 1.6 percent to 2,140.5 pence

A gauge of mining companies increased 1.1 percent after copper rallied from its lowest price since Sept. 4 on the London Metal Exchange.

Rio Tinto, the world’s third-largest mining company, climbed 2 percent to 3,142.5 pence. Vedanta Resources Plc also gained 2 percent to 1,150 pence, while Xstrata Plc rose 1.4 percent to 981.8 pence.

BHP Billiton

BHP added 1.8 percent to 2,010 pence. The world’s largest mining company plans to spend more than $6 billion to increase production of iron ore to more than 175 million metric tons in the year ending June 30, according to Marcus Randolph, the Melbourne-based company’s chief executive officer of ferrous and coal. BHP allocated about $4.5 billion to expand ore production in fiscal 2012.

Imperial Tobacco Group Plc gained 1.6 percent to 2,370 pence. Europe’s second-largest cigarette maker reported full-year adjusted operating profit of 3.16 billion pounds ($5.1 billion), compared with 3.1 billion pounds a year earlier. The average estimate of eight analysts surveyed by Bloomberg had called for profit of 3.19 billion pounds.

Barclays Plc gained 3.4 percent to 238.8 pence before the bank reports earnings tomorrow morning. Britain’s second-biggest bank may say pretax profit rose 25 percent to 1.67 billion pounds in the third quarter, according to the median analyst estimate, as revenue from the fixed-income arm of its securities unit jumped.

The results will be the first for Antony Jenkins, who took over as chief executive officer in August after Barclays was fined a record 290 million pounds for manipulating Libor.

Quintain Gains

Quintain Estates & Development Plc climbed 1.9 percent to 54 pence. The company’s biggest shareholder, Laxey Partners Ltd., sold a 10 percent stake in the British property developer, according to a person familiar with the transaction. Numis Securities Ltd. placed 53 million shares at 53 pence apiece on behalf of Laxey, a separate person said.

Standard Chartered Plc slid 0.9 percent to 1,483.5 pence. The shares fell as much as 2.7 percent after the bank said operating profit in the first nine months rose by a “mid-single-digit” rate as growth in Asia slowed.

The lender also said that revenue grew at a “high-single-digit rate, maintaining the trajectory seen in the first half.” In August, Standard Chartered forecast full-year revenue growth of at least 10 percent.

Centamin Plc plunged 35 percent to 63.8 pence before the shares were suspended from trading. The stock slumped the most since its initial public offering in 2001 after Egypt’s Administrative court annulled the company’s contract to extract gold from the Sukari mine. The state-run Egyptian Mineral Resources Authority failed to exercise sufficient oversight of the facility, the court said in a faxed statement today.

To contact the reporter on this story: Sarah Jones in London at sjones35@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net