The FTSE 100 Index has risen 19.7 points, or 0.4%, to 5642.5 so far this morning led by commodities companies BP, BHP Billiton and Anglo American as oil trades near $60 a barrel and gold prices increase.
Hilton Group has also climbed 4.5p, or1.23%, to 369p. on reports the UK company is close to selling its lodging business to Hilton Hotels of the US for £3.6bn with an announcement expected this lunchtime.
BHP Billiton, the world's biggest mining company, is up 1.4% to 948p. Anglo-American has added 0.9% to 1981 pence, while BP, Europe's biggest oil company, is up 0.7% to 625.5p. Royal Dutch Shell, the second largest, has also advanced 0.3% to 1786p.
Meanwhile, gold is trading near its highest in two weeks on speculation central banks, the biggest holders of the metal, may buy more bullion to diversify their reserves. Gold for immediate delivery has risen as much as $1.07, or 0.2%, to $517.67 an ounce.
Oil is trading close to $60 a barrel on expectations US economic growth will boost demand in the world's largest user of energy. Crude for February delivery traded at $59.85 on the New York Mercantile Exchange, after gaining 2.9% yesterday. BP and Shell account for about 18% of the FTSE 100 by weighting.
Japan's Nikkei 225 Stock Average rose 0.9% to 16,344.20, extending a rally that lifted the index to its highest in more than five years at it close a short while ago.
Toyota climbed to a record after reports showed US consumer confidence and retail sales gained. Toyota climbed 2% to a record 6,110 yen. The shares have surged 47% this year, the biggest annual jump since 1999.
Sony, the world's second-biggest consumer electronics maker, added 2.3% to 4,880 yen, its highest position since January 2003.
Inpex, Japan's biggest oil explorer, added 2.9% to 1.08 million yen. Nippon Oil, Japan's biggest petroleum refiner, gained 0.7% to 909 yen.
In the US, the Dow Jones Industrial Average shed more than 100 points to close at 10778, late last night, on recession fears caused by the bond market.
The yield on the 10-year bond sank below the yield on the two-year bond.
This rare situation, known as an "inversion of the yield curve," has historically presaged a recession.
Despite the recession fears triggered by the first inversion in five years, yields held steady yesterday, with overall Treasury prices modestly lower. In thin, end-of-year trade, the 10-year yield sat at 4.37%, a touch higher than the 4.36% yield on the two-year note.The shape of the yield curve, where yields are plotted against maturities, caused far more reaction in the stock market on Tuesday, where investors heard recession alarm bells when the slope first turned negative.IFAonline
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