US T Bonds tantalizingly close to that major rally
DOGE USAID cuts just the beginning
DOGE about to look at Medicaid and Social Security
Gold just keeps heading higher
Gold stocks ready to surge much higher
ASX Gold index to pass through 10,000 today
Key points
US T BONDS
Sharp fall in yields on bonds
RHS on TLT looks good
Will the US have a Budget Surplus by end 2026?
DOGE cuts USAID theft scam
Updated computer systems for Medicaid/Medicare and Social Security
Will cut costs substantially
Massive fraud also identified here
GOLD
Heading towards US$3,000 and beyond
Don’t just look at the short term
Big picture suggests many US$,000 higher
Think of this as a market with more short covering
Then strong buying across the board
Criminal suppression of gold for decades now ending
GOLD STOCKS
That move on the 2011 DT was very important
PERs of 6-7x are far too low
Expect multiple expansion
Then think earnings increase
XAU to 240 (+50%) very quickly now
ASX GOLD INDEX
MPS universe of gold stocks is still 6-7x EPS as well
XGD hit alltime high of 9975 yesterday
10,000 today
12,000 very quickly
Then 20,000 within two years
US Bonds
There has been considerable focus on the US bond market here for some time.
As you know it is the biggest market outside the currencies and there is US$37tn in US Government debt out there.
There is a big roll over of this debt due in 2025 so the marketplace is acutely aware of the importance of bond prices and yields.
The Elon Musk DOGE has made some important cuts and the recognition of the massive fraud in USAID is certainly making the citizens all the US to stand up and take notice.
There is indeed a criminal mafia involved in the theft of taxpayer money but it seems to be running far deeper than just the US$72bn budget of USAID.
As has been pointed out here numerous times the US constitution makes no provision for a Federal bureaucracy and the United States is still essentially a union or federation of 50 sovereign states and the responsibilities on health, education, environment etc are really individual state issues.
The US FY2024 `Budget’ here shows massive expenditures on health and Social Security:
US$bn
Medicaid
558
Medicare
842
Social Security
1459
Total
2,859
Commentary abounds about the antiquated computer systems used by these Federal Agencies and DOGE would be the ideal group to upgrade it with remarkable efficiency.
Could it be a 10% efficiency gain coming here?
There are reasons to be believe massive fraud also exists with long dead names still receiving benefits – much the same as with the voter rolls.
Illegal aliens have also been major users of health and medical services.
We live in interesting times.
DOGE has already identified cuts of US$4bn per day to cut the deficit to just US$1tnpa by end 2026.
The numbers on cost reduction are likely to be much higher so maybe a balanced budget or surplus in 2027!
Why is this important?
Lower debt means lower taxes and lower interest rates.
And a stronger economy.
And with massive infrastructure renewal likely, the demand for raw materials will be very strong.
So the action in the bond markets is critical.
Sharp fall here strongly suggesting much lower rates comingThe RHS concept is looking better every day now. BIG rally soon.
GOLD
More new highs and much more to come.
Short term parabola looking very goodMedium term parabola also very good.
Keep the bigger picture always in mind.
Another parabola here and an uptrend channel as wellThe big picture suggests we are only one third of the way there. US$1200 so far. US$2500 more to come ?
Gold stocks to outperform gold after 16 years downtrend
Gold breaking upward vs S&P500
Gold stocks ready to follow
KEY POINTS
GOLD
• Gold through US$2800 • Parabolic journey still intact • US$3,000 soon • Gold in other currencies making strong moves
GOLD STOCKS
• Leading stocks making new highs • XAU ready to test 165 again • Then much higher • 16 year decline against gold coming to an end • Breakout coming • Breakout against stocks coming soon
ASX GOLD SECTOR
• A$4520/oz gold pushes earnings • ASX XGD close to 10,000 • 16 year decline of XGD vs A$ gold now turning up • Some excitement at last
It is wonderful to watch gold moving higher and on its way to US$3,000 and beyond.
But it hasn’t been too wonderful watching gold stocks only meandering along and falling as much as rising.
When will true market reality take over from this current fake reality?
Hopefully quite soon.
US$ gold is running nicely in this small scale parabola and should be accelerating soon.
US$ gold is heading higher with a longer term parabola and gold in other currencies is showing an even stronger set of technical.
Gold in A$ is showing that extra surge and we will soon be talking about A$5,000/oz.
This break out by the XAU is a very good sign and is likely to accelerate quite quickly.
Some of the major gold producers have been slow but market leader growth stocks are already making new highs.
New highs here in these growth stocksAnd here
While we have been wondering about the lack of follow through for so many stocks here it seems that the market place is finally waking up elsewhere.
Gold is now moving higher against the S&P500 and it is not because of a market crash.
And very soon there will be a sharp move higher of gold stocks against general stocks.
This coming move could be quite violent.
Has already broken higherThe break is yet to come but it will be sharp
So gold stocks are now ready to break upwards against gold bullion.
This has been protracted but it is turningThe bigger picture is very strong
So in Australia we have the XGD Gold Index heading up to 10,000 again and ready to make a strong break.
In the time this has been heading higher from the lows in 2014 A$ gold has risen far more.
ASX Gold Index 2008 – 2025
So the net effect is a 16 year decline in ASX XGD Gold Index vs A$gold.
China, India, Russia and US new nuclear generating capacity coming
Russian supply to US cutting off in 2027
US tariffs on Canadian uranium creating confusion
PRIMARY URANIUM MINE PRODUCERS
Largest global producer (~30%) Kazakhstan output has peaked
#5 producer Uzbekistan heading lower
NexGen 12ktpa project being developed in Canada
African producers reopening
U3O8 MARKET PRICE ACTION
Major rise from US$30/lb in 2018-2020 to US$105 still being digested
Recent selloff was ~35% below early 2024 peak to US$68.70.
Could have seen the reaction low but may test US$65 under the price gap
Uranium enriched product prices and enrichment treatment charges still rising strongly
Uranium producers share prices still below 2024 highs
URANIUM ETFS
Uranium stock ETFs holding uptrends and testing downtrends
Constructive technical positions but could see weakness before strength
NTH AMERICAN URANIUM MARKETS
Concerns in Canada over Trump Administration import tariffs
Confusion on impact and consequences
Markets at key technical points
Prices to go lower or higher?
ASX URANIUM PLAYERS
Following the Nth American companies in share prices
Boss Energy in production at Honeymoon Q2 2024 with full capacity of 2mlbpa
30% owned Alta Mesa in production in Q4 24 and heading for 1.5mlbpa by Q4 25
Paladin Langer Heinrich has first production in Q1 2024 doing 3.5mlbpa
Lotus reopening Kayelekera in Q1 2026 @ ~2mlbpa
Deep Yellow to make FID decision in Mar 2025 for 3.6mlbpa Tumas Project in Namibia
EL8 aiming for a Scoping Study on Namibian uranium resources
Bannerman Etango under construction in Namibia for up to 6.7mlbpa from early 2027 startup
Explorers active in Australia
Be ready for resumption of bull market in ASX uranium stocks
Nuclear energy is having a renaissance.
Energy demand is so strong that all fuels and hydro will experience increasing demand over the next decade.
The US has pulled out of the Paris Agreement and is there with the other BIG three CO2 emitters China, India and Russia and out of the economic suicide that the EU, UK and Canada are intent on pursuing.
(Thank you Alan)
Australia is still there but we have an election coming up and chances are we won’t be there soon as well.
Economic and technical simpletons have been running Australia’s energy policy and it shows!
Peak Wind Power and Solar Power have been passed.
All the US$ trillions expended on white elephant offshore wind farms and regional solar acreages will prove to be uneconomic and unreliable.
The A$ billions committed by simpleton politicians, the bureaucracies and their donor backers have been done without building vigorous business cases and will surely end up being more NBNs.
Capex is too high and technologies soon to become obsolete.
It is times like these that it dawns on people that governments should not be in the business of business.
Simpletons with bright ideas spend vast amounts of taxpayers’ money unsuccessfully but leave taxpayers with debt and more taxes.
The Great Awakening is all about realising it is citizen’s money that is being wasted and future taxes will need to pay for it all.
The marketplace won’t be allowing it for much longer.
New processes will help solar into better and far more efficient technologies but they aren’t here yet.
China and India are still heading into more coal fired generation for the next decade.
China now consumes 650mtpa more coal than five years ago while the simpletons cut Australia’s annual consumption by 27m tonnes over the same period.
The world’s energy is >80% reliant on hydrocarbons and Australia as the second largest exporter of each of thermal coal and LNG is cutting back.
And of course it bans nuclear energy and frowns on being on being one of the largest exporters of yellow cake uranium oxide even though it has some of the world’s largest uranium deposits.
With Australia governments controlled by student-day activists at the representative and bureaucracy levels it will need a big shakeup to get these to change.
That big shakeup is coming.
`Progressive’ Big Tech in the US is now jumping on the Nuclear bandwagon after realising data centres and AI will need even more electric power.
Closed nuclear plants like Three Mile Island are being resuscitated.
In addition, in countries with relatively old nuclear fleets, the trend is for is licence extension.
Many plants built in the 20th century in the US were licenced to run for 40 years but are now being granted 20-year extensions, bringing the expected lifetime of many to 60 years.
Some reactors have seen their licenses extended to 80 years.
France and Spain have also recently extended licences of operating reactors beyond their 40-year initial lifetimes.
Uranium producers are now seeing utility demand being brought forward and see a bright future.
Forecasts for electricity production have optimistic case levels that could see nuclear power capacity more than double by 2050.
China, Russia and India will be the leaders of the next round of nuclear generating capacity.
How amazing that Australia, as the world’s 13th largest economy, has none and nothing planned.
The biggest issue for nuclear generating plants is the time taken to build them.
Green tape, black tape and red tape extend the planning and construction of one-off bespoke units and that really amounts to capitalised interest over a decade of construction by semi-skilled labour.
Location in sites of existing coal fuelled generators could cut that time and cost substantially.
But Small Modular Reactors actually offer something else.
Manufacturing by skilled workforces reduces the time line significantly.
Importantly, if a nuclear generating plant is floating it can be manufactured elsewhere and installed on or along a coastline.
This has already been done.
Many SMR technologies are being developed in a very wide range of sizes.
Current electricity generation capacity in nuclear plants is around 450 GW and The International Energy Agency has recorded potential for capacity equivalent to >25% of current levels to be brought on by 2050.
This is over 1,000 new SMRs.
New nuclear generating capacity needs additional uranium supply.
Global consumption is around 80,000 tonnes but US current uranium demand of 20,000tpa is likely to be 200% higher in the next 20 years and the growth equal to 50% of current total global requirements.
US nuclear power generates almost 20% of US total electricity but it is certain to rise.
Where will the Uranium come from?
As noted for other metals like silver and palladium with supply deficits being filled from inventories it is clear the position of uranium is the same.
Inventory rundown has been underway since 2018.
Projections suggest the supply deficit is long term chronic and will last another twenty years until the mid 2040s.
The market place is aware that nuclear and uranium supply chain investment in the coming years will require vast amounts of capital and important political decisions over extended periods.
Australia will be compelled to make those decisions as well. And soon.
The US currently produces next to no uranium but imports from Russia.
The US production lift will be coming soon.
Kazakhstan is the world’s largest producer of uranium, almost all from In-Situ Leach (ISL) operations.
At 21ktonnes it is three times that of #2 Canada.
Operational difficulties in Kazakhstan have forced Kazatomprom to commit to `Value over Volume’.
Output is on a clear path of decline.
Production risk here is substantial.
URANIUM PRICES
Uranium yellowcake prices rose sharply to US$65/lb with the Ukraine War in 2022 and then very strongly again in 2023-24 to >US$100/lb.
Yellowcake prices then weakened off in 2024.
The decline to US$68.70 was quite strange given the supply deficit structure but the futures market is thin and with large speculative holders of physical yellowcake around, this futures market can be fickle.
Note that the real market that includes converted UF6 has remained quite firm despite the weaker spot yellowcake price.
Short term pull backs after a strong rise.
Does the gap between US$65 and US$68 need to be filled first?The long term is a big bull marketIn contrast to spot yellowcake, the intermediate products and conversion rates are rising strongly.
22 year history. Source: John QuakesMore recent activity showing rises in enriched product and UF6. Source: John QuakesUranium ETF is ready to make a major break out higher in 2025.
Could fake out lower before moving higher.The longer term is a for a very large break out higher in 2025
Looks very positive.
The North American Market is important for uranium with the US the biggest uranium consumer at around 18kt with Canada # 6 at 4.5kt and Canada the #2 producer of yellowcake.
The Eric Sprott organisations are key players in gold and silver and also uranium with ETFs for uranium producers, uranium explorers and physical uranium.
These are carefully watched market trend indicators.
The Trump 25% Tariffs will hit Canadian miners selling into the US.
The impact is unclear at present.
We just have to heed the markets.
The Uranium Miners ETF is the key indicator. It appears to be in a major long term bull market. Was the Oct 24 high just a backtest of the 2020 breakline? Will it hold this uptrend?The `b’ wave made a new high and shows internal strength. The run up in Dec Qtr 2024 was a clear five Wave 1 so will it hold for Wave 2 here? Could fall to US$33 without affecting long term bull.The Sprott Explorers ETF is behaving similarly to the Producers ETF.Will US Tariffs force yellowcake to fill the gap at US$65 first? This could weaken to C$18.Size of Uranium ETFs URA US$3.45bn Sprott Producers US$1.50bn Sprott Explorers US$0.26bnMoment of Truth
Gold vs Uranium.
Breakout coming - but which way?
Major players in Uranium
Cameco (10ktpa) is market leader and is in uptrend with an underlying parabolaSome long term resistance before moving higherKazatomprom- World’s largest uranium producer with gross 23ktpa and net 12ktpaRook 1 Project for Arrow deposit is developing low cost 13kpta in Athabasca BasinUS uranium project developer Holds 1.3mlb physical uraniumUranium Royalty company with interests primarily in US and Canada Holds 2.8mlb physical uranium Yet to generate royalty revenues
ASX Uranium Companies
This MPS Uranium Stock index broke down last year and is behavely similarly to the Sprott ETFs.
Is it being driven by the same Nth American investors given that the locals aren’t particularly interested?
All these ASX uranium companies have the same uptrend, same short term downtrend and similar horizontal support in their ten year price histories.
Gold imports to US surged before the tariffs apply
Gold stocks are so cheap
DOGE is slashing US expenditures
The criminals are all being outed now
Its GLOBAL
Coming to Australia too!
Bonds looking interesting
US$ likely to strengthen further
ASX Gold Index about to break much higher
I do hope everyone is observing what is happening in the US and what is spreading all around the world.
It is the Great Awakening.
You can call it what you like.
And like it or not.
But it is happening.
The US, UK, Argentina, Canada, Italy, Poland, France, Germany. Everywhere and spreading.
The new Trump Administration is now unwinding in rapid time much of the evil that has developed since the Post-WWI Gold Standard set up under the Bretton Woods Agreement in 1944 was abandoned in August 1971.
You might recall one of these notes pointing out that President Johnson in 1967 set in train the administrative changes of Deficit Spending that forced President Nixon to make that announcement in August 1971 that broke the link between the US$ and gold.
The World changed at that exact time.
For the next 50 years governments around the world set off in developing the Welfare State that took control of lives from the individual and placed it with the State.
Governments created dependents in the form of welfare recipients and of course government employees.
And intruded into education, health and medicine, labour, business and pushed environmentalism.
This is clearly shown with this register of US Federal Regulations.
Started right on cue in 1971.
Graphic from a discontinued blogContinuation of the data from the original data source.
Source Ten Thousand Commandments
The Great Experiment in Socialism was well promoted by left wing academics and then State-owned media and then all media.
There was experience at first hand in the remarkable expansion of Canberra and its bureaucracy after PM Whitlam’s December 1972 Election win.
Massive expansion and the carpet baggers came in. So many from Melbourne. How strange!
Inflation and high interest rates.
As Margaret Thatcher so succinctly put it, `Socialism is wonderful until you run out of Other Peoples Money’.
The tidal wave of Trump Executive Orders is now changing all that.
The biggest issue is really the massive uptake of personal income taxes at the Federal level (US$2.5tn +Medical and Social Security taxes = US$4.1tn) and then the squandering of these funds in utter waste.
Taxpayers are not getting value for their money and living standards have been falling.
DoJ-FBI, Electoral Fraud and Gender and DEI matters are important issues but fascinating developments are taking place elsewhere.
Budget cutting is well underway.
The 2 million Federal employees have all been ordered to show up to work in the office and all have been given the offer of 6-8months pay to resign.
All Federal Grants have been frozen.
Elon Musk and DOGE have already concluded (on Saturday 1 Feb 2025) that the FY2026 Budget Outlays will be reduced by US$4bn per day by Sept 2025 to reduce the deficit from US$2 to just $1tn.
Finding consistent details not easy with the US bureaucracy but here is some to review.
Expenditures are way ahead of revenues.Corporate income tax is not large compared to the US$2.6tn in personal income tax and levies for medical and Social Security.US Treasury dataSource: US Dept Treasury
The US is where it is.
It has to change.
And changing it is.
Note this - 1 February 2025
84.7 million views.
The World now is starting to understand.
DOGE also found that the chief financial controller in the Treasury took no fiduciary responsibility at all and simply signed off on every and all transfers of US Government funds.
Evil criminal thieves.
And you thought I was just sounding off!
So we are here with the US Bond Market and this is critical for gold:-
Are we seeing a major reversal here?
Not because the stock market is going to crash and the US go into severe recession but because the supply of bonds is about to be reduced.
Do we have the RHS for a reversalStill that US$37tn questionThe collapse into 2014 was once in a lifetime 25% fall in capital valueYields here have still not exceeded the 2023 highsIs the 5 year yield about to break lower now6 months is still well below the Fed Funds RateUS$ about to head higherProbably much higher
The US will be a great place to invest.
Why go anywhere else?
Euro likely to fall below parity soon. Nothing to like politically to hold the EU togetherThis is unlikely to be a wedge to send the Yen higher. Another low below 62 will be awful.PM Starmer is in deep doodoo over the cover up of the Pakistani Muslim gang rapes inquiry that he presided over. 100,000 Brits turning out in London is pleasing and Reform is doing well.The Swiss Franc has lost its Golden lustre.
While the US yields might be turning lower, the yields elsewhere in these countries are heading higher.
Canada
The tariff issues are bringing out massive levels of public debate over the mismanagement by the Justin Castro regime.
He has resigned but they are trying to replace him with the former Governor of the Bank of England.
Constitutional crisis coming up.
The Canadian currency has just made a sharp selloff that could see it heading lower.
But note that the CDNX on TSX-V is moving up.
Mexico
Fun things going on with Mexico and its border and the cartels.
We are living in very interesting times!
The Peso could just drop into the next channel and head much lower.
Australia
In Australia we have government bond yields that appear to have peaked in 2023.
10 Year Commonwealth Bond3 Year Commonwealth Bond
The A$ is not finished yet.
Same level as 40 years ago.
But indications are for a strong move higher against the Euro, Pound and Yen.
Anticipating a near term election and change of Government.
Goodbye to the simpletons.
Gold
• New US$ highs last week • What will tariffs do to precious metals? • Massive transfers out of London vaults to US to avoid tariffs • Short positions still massive • Suppression of gold for decades still to be unwound • How high gold?
With all the above happening the opportunity for gold is now very strong.
A new Gold Standard will return.
Central banks will just have to keep buying gold!
How much does the US now hold
8400 tonnes?
None?
15,000 tonnes?
We should soon find out!
New highs for US$ goldBreaking out here
Gold Stocks
The big move is coming very soon.
Breaking outThis looks excellent
It is interesting to see that the number of GDX shares has continued to decline reflecting institutional investors are selling rather than buying.
But ETF holdings of physical gold are heading higher again.
• Breaks through pennant structure • Trading above US$2700 again • US$3000 in March Qtr
GOLD STOCKS
• XAU 3.5% higher • Breaking out vs gold • Breaking out vs general stocks
ASX GOLD INDEX
• Moving to test 10,000 again • Runaway bull market after
US$
• Breaking out from flag pattern • Major currencies weaker
GOLD
It seems that pennant in the US$ gold price has indeed eventuated and new highs are likely in 2024.
Gold is above US$2700 again and hopefully it will be above US$3000 in March Qtr 2025.
It is pleasing to see this happening with as strong US$.
Is it a warning about events in the Middle East or Ukraine?
The Russian ruble is making new lows against the US$ and the Euro, Pound and Swiss France are looking very weak.
Whatever the reason or outcome it is pleasing to see gold stocks are looking very good indeed.
That 145 level on the XAU held nicely as it bounced off that 2011 downtrend.
Gold stocks are now starting break out against general equities.
The move will be multi year and the gains are likely to be very great.
Gold is also breaking out against stocks.
Note too that the gold stocks vs gold ratios are making that RHS of a H&S reversal pattern so gold stocks should become supercharged.
The NST/DEG merger means portfolios are overweight NST (could this ever really be true!) so the time to move into the cheaper gold developers has arrived.
Ask me what to invest in!
Gold moving above US$2700.
This move is too strong to be a B wave so it must be another impulse move.
Gold has moved another US$23 since this chart from Tuesday’s close.
It could resume its position above the parabola.
Gold is about to make a major break against general equities.
Gold up or stocks down?
GOLD STOCKS
The Xau has held that 145 very well indeed in the short term.
The longer term is very positive.
Holding the 2011 downtrend has been very important.
A break out through 165 again – just <5% away – will launch a very big out of the box move.
The XAU was up 3.5% today!!
Gold stocks against gold is looking very positive now.
And a big move coming against general stocks.
It is all about earnings!
ASX GOLD INDEX
This is all about earnings here as well.
A break above 10,000 will see a runaway bull market here.
Gold is moving to challenge previous 2011 highs of US$1800-1923 and has a near term target of US$1800 where some consolidation `should’ take place.
But note that more consolidation around here could allow gold to exceed previous high at US$1923.
Shorter term suggests the current consolidation is nearly over and we should move higher.
Don’t you just love long term charts! From Jason Atkinson in Dallas @schism
Institutional investors have added to portfolios abut are still low compared to previous gold bull market leg.
The main driver is likely to be the short covering from Western gold market participants although it would be expected that Asian demand is likely to be soft for a while yet.
Physical gold is scarce and premiums are being paid for coins and bars.
Some US numbers on coin sales. (Can’t confirm source though)
US$ holding strong. The numbers might seem horrific but just think of the numbers everywhere else. Who would buy the Euro(57% of this index)?
Nth American Gold Stocks
And those liking the long term, the XAU should rise about 50x over the next decade. From Jason Atkinson in Dallas @schism
And here. Gold stocks vs S&P500. From Jason Atkinson in Dallas @schism
A$ has had a major reversal.
A$ will follow gold and goldstocks
A$ gold to consolidate with rising currency.
The Australian gold industry is doing very well at present with record production and record exploration at a time of record gold prices.
Gold sector shares should rise much higher and action should just get better as market breadth expands and more investors participate.
Aren’t you glad you bought NST for dividends a few years ago and not NAB or the other banks!
NAB
When I think of Silver I think of Palladium. When I think of Palladium I think of Silver. For Silver Bulls - From Jason Atkinson in Dallas @schism
The low for oil is in. The recovery will be rapid. Graphics from @Gradhhy
The final Eurozone PMI for Sep'12 rose to 46.1 from 45.1, revised up from a preliminary reading of 46. The most notable single nation PMI cake from France where the index fell to 42.7, from 46 the previous month.
The number of unemployed in the Eurozone rose to 18.196m in Aug'12, up 34,000 from the previous month and to the highest level on record. The unemployment rate remained unchanged at 11.4%. Notably, Spanish unemployment hit 25.1%.
Late on Friday, the Spanish banking system showed it required £59.3b for recapitalization plans, which was in line with expectations.
Moody's stated that Spain's bank recapitalization plan is "credit positive", but ultimately may be "insufficient".
Bernanke gave a speech to Economic Club of Indiana overnight in an attempt to shed some light on QE3, stating the basic monetary policy strategy is "the same as its always been".
Resources Snapshot
Xstrata recommended Glencore’s revised £20.5b takeover to its shareholders.
Indonesia's new mining laws that came into effect in May'12 and relate to exports have had a profound effect on cutting exports, particularly to China. For example, Chinese imports of nickel from Indonesia in Aug'12 fell 39% to 1.48mt.
International Equity Markets
DOW JONES: Up 0.58% (or 77.98 points) to 13,515.11. Markets across the U.S. gained overnight on upbeat manufacturing data, but pulled back from session highs as Bernanke spoke about the Fed's decision to launch QE3. In economic data, the U.S. ISM manufacturing index rose 51.5 last month from 49.6 in Aug'12, the highest reading since May'12 and an unexpected return to expansion. Additionally, the Commerce Department reported that construction spending fell 0.6% in Aug'12, well below the 0.5% gain expected. 26 companies gained with 7 topping 1%. The financials had a strong run with American Express and Bank of America gaining 1.5% each. The notable fallers included Caterpillar and Microsoft.
FTSE 100: Up 1.37% (or 78.38 points) to 5,820.45. European markets noted their strongest one night gain in recent weeks overnight as better than expected U.S. data boosted investor sentiment. The banking sector was notably higher with RBS, Lloyds, HSBC and Barclays gaining between 2.5% and 3.7% respectively. Additionally, heavyweight mining companies rose with BHP and Rio gaining 2.6% and 1.8% respectively. Fresnillo, Kazakhmys and Randgold Resources followed higher. Xstrata gained 2.4% after the Board recommended the revised Glencore offer. Lastly, energy companies BG Group and Shell gained 2.3% and 0.9% respectively.
