FTSE closes on four-year high

Soaring oil and mining stocks powered the FTSE 100 Index to a four-year high today despite a lacklustre showing by retailers.

A fresh rise in the cost of crude and an upbeat broker note triggered gains of between 2% and 3% for both Royal Dutch Shell and BP, helping the Footsie to kick ahead 36.1 points to 5383.5.

The Footsie’s move towards the 5400 barrier came despite gloom over the retail sector following downbeat figures from the likes of Next and Kingfisher.

Official retail sales data showing a sharp drop in food sales during August also unsettled investors in many of the major blue-chip supermarkets.

Mining giant Rio Tinto was the second highest blue-chip riser after benefiting from an upgrade by Cazenove and confirmation that it will participate in a major gold project in the US.

Shares in Rio Tinto rose 63p to 2070p, while rival BHP Billiton cheered 19.5p to 846.5p and Xstrata ticked 30p higher to 1375p.

Shell was also among the highest risers, up 55p at 1875p, while rival BP lifted 14.5p to 646.5p after broker UBS upgraded BP and lifted its target on Shell.

However, many retailers were in the doldrums as figures from the Office for National Statistics showed high street sales failed to bounce back last month, compounding disappointing results.

Supermarkets felt the backlash from investors after food sales fell 1.2% in August, with Tesco down 4.25p at 324.5p and Morrisons off 4p at 180p.

B&Q owner Kingfisher fell nearly 4% or 9.5p to 235.5p after revealing that its UK profits had fallen by a third.

Clothing chain Next trailed it at the top of the fallers board after reporting a 6% fall in like-for-like sales for the past six weeks – with its share price slipping 48p to 1442p.

Other retailers under pressure today included GUS, down 10.5p at 892.5p, and there was a 2.5p decline to 152p at DSG International – the new corporate name for Dixons.

Energy supplier Centrica was also in the red, losing 4p to 255.25p, as news of a 19% rise in half-year profits was accompanied by a cautious outlook.

But there was better news at Aggreko after demand in the US following Hurricane Katrina led the temporary power specialist to forecast full-year profits well ahead of expectations. Aggreko shares rose 12% in the FTSE 250 Index, up 25.5p at 238p.

Security personnel firm ArmorGroup was also upbeat, adding 3% or 1.5p to 53.5p after saying a “strong and increasing” order book made it confident that operating profits for the current year would be ahead of last year and in line with management hopes.

The highest Footsie risers today were BOC Group up 42p to 1172p, Rio Tinto adding 63p to 2070p, International Power up 7.25p to 244.5p and Royal Dutch Shell adding 55p to 1875p.

The heaviest fallers were Kingfisher down 9.5p to 235.5p, Next off 48p to 1442p, Smith & Nephew losing 15p to 496p and Boots down 14.5p to 620p.