FTSE 100 closes 2010 9% higher

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The FTSE 100 climbed around 9 per cent over the course of 2010

Investors have reflected on another year of progress after the FTSE 100 Index climbed by around 9% over the course of 2010.

The rally, which followed a 22% improvement for the top flight index in 2009, was overshadowed by a poor final session of the year, as the FTSE 100 sunk into the red despite an earlier push towards the 6000 barrier.

It finished the year at 5899.9, a drop of 71.1 points or just over 1%.

Weaker mining stocks were to blame for the lacklustre performance, but with the London market closing at lunchtime on Friday there was never likely to be much in the way of corporate news to drive buying interest.

While miners deprived the market of a final day flourish, the sector has been responsible for a large slice of the year’s gains in the FTSE 100 as a result of rising commodity prices and Asia’s continued strong economic growth.

In currency markets, the euro ended a difficult year on the front foot after posting gains against most major currencies. The pound was worth 1.16 against the euro and 1.55 on the US dollar.

Kathleen Brooks, research director at forex.com, said the euro would start the new year in a stable position. She added: “We haven’t seen the capitulation in the single currency that some expected even as the peripheral debt crisis imploded. This reinforces our belief that this remains fundamentally a credit crisis rather than a currency crisis for the currency bloc.”

In London, Weir Group took the crown as the best performing stock in the FTSE 100 Index. The Glasgow-based company, which sells pumps to the mining and oil industry and is affected by movements in commodity prices, rose 147% in 2010 and by 3p to 1779p during the final session of the year. Weir just pipped chip designer Arm Holdings, which rose by 141% in the year.

The performances of Fresnillo (up 111%), Antofagasta (up 62%), and BHP Billiton (up 28%), whose share prices rise and fall with the price of the commodities they produce, highlighted the positive impact of the sector in 2010.

On the fallers board, BP finished a difficult year down by around 22%, including a drop of 5.15p to 466.05p in the final session. The biggest blue-chip faller was insurance consolidation group Resolution following a decline of 32%.

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