Resource stocks performed well in morning trade, lifting the FTSE 100 over 1.1% higher. Miners were gaining ground after some positive economic data from China boosted sentiment, while Cairn Energy was on the up after detailing its $3.5bn cash return to shareholders.

A big mover was Gulf Keystone, the AIM-listed oil and gas firm, which shot up over 16% on unconfirmed speculation that it could be sold, according to Bloomberg. Gulf Keystone reported this morning an agreement over options at two of its sites with the Kurdistan Regional Government (KRG). The firm has agreed that the KRG may assign an interest to a third party in both the Shaikan and Akri-Bijeel blocks.

RESOURCES STOCKS PROVIDE A BOOST

With Chinese foreign trade data beating expectations, the miners were on the rise in the opening minutes. Vedanta Resources, Antofagasta and Kazakhmys were providing a lift, while Burberry - the luxury firm sensitive to developments in the Chinese economy - was also in demand.

China's trade balance widened from $145.3bn to $165.2bn in December and while import growth had slowed, imports for copper and aluminium accelerated.

Oil and gas firm Cairn Energy was a high riser after giving details of the long-awaited $3.5bn it intends to return to its lucky shareholders following the $5.5bn sale of a large stake in its Indian business to Vedanta. The return of cash will take place as a 'B' sharescheme which will give UK tax-payers the chance to receive cash in the form of income or capital, or a blend of both. Oriel Securities upgraded the stock from hold to add this morning.

RETAILERS IN FASHION

High street giant Marks & Spencer rose after seeing sales (excluding VAT) rise 2.4% in the final 13 weeks of 2011. As for the all-important like-for-like sales comparisons, overall, the UK stores were up 0.5%, with General Merchandise down 1.8% but Food up 3.0%.

Another retailer, FTSE 250 department store chain Debenhams, also issued a trading statement today and saw its share price jump 10%. The firm reported 6.5% improvement in like-for-like (LFL) sales including VAT in December.

"All in all, we've seen some cracking results this morning from two of Britain's leading high street retailers," said Cavendish Asset Management's Senior Fund Manager Paul Mumford. "The gloom and doom factor regarding Marks & Spencer and Debenhams was palpable last week; commentators and analysts have were in the main deeply pessimistic ahead of today's results. Yet in both cases results have exceeded expectations, and we are seeing relief rallies as a result," he said.

Helping the rally in the retail sector, which was gaining an average 1.9%, was the news that retail LFL sales rose 2.2% in December.

In other company movements, banks were putting in a good performance with Barclays leading the way gaining nearly 5%, despite having its target price cut by UBS. The Swiss broker has reduced its earnings forecasts by 1% and 6% for 2011 and 2012, respectively, on the back of a "uncertain outlook". Sector peers Lloyds and RBS were also registering decent gains despite the latter being on the verge of shedding between 3,000 and 4,000 jobs, according to Reuters.

Just nine stocks were in the red on the FTSE 100 by midday, with defensive pharma peers GlaxoSmithKline and AstraZeneca among them. Tesco edged lower after Bank of America Merrill Lynch downgraded its rating to neutral from buy.

BC

FTSE 100 - Risers
Vedanta Resources (VED) 1,035.00p +5.83%
Barclays (BARC) 187.00p +5.00%
Antofagasta (ANTO) 1,293.00p +4.78%
Kazakhmys (KAZ) 1,021.00p +4.29%
Johnson Matthey (JMAT) 2,002.00p +4.16%
Fresnillo (FRES) 1,700.00p +3.79%
BAE Systems (BA.) 300.10p +3.77%
Burberry Group (BRBY) 1,322.00p +3.44%
Royal Bank of Scotland Group (RBS) 20.74p +3.34%
CRH (CRH) 1,246.00p +3.32%

FTSE 100 - Fallers
GlaxoSmithKline (GSK) 1,412.50p -1.57%
Sage Group (SGE) 297.60p -0.70%
Aggreko (AGK) 2,118.00p -0.61%
AstraZeneca (AZN) 2,991.50p -0.58%
Smith & Nephew (SN.) 597.50p -0.50%
ARM Holdings (ARM) 610.00p -0.49%
Shire Plc (SHP) 2,166.00p -0.18%
SABMiller (SAB) 2,337.50p -0.17%
Tesco (TSCO) 390.15p -0.08%

FTSE 250 - Risers
Debenhams (DEB) 62.55p +9.93%
Talvivaara Mining Company (TALV) 279.60p +5.95%
Centamin (DI) (CEY) 85.55p +5.81%
Afren (AFR) 109.50p +4.58%
Victrex (VCT) 1,170.00p +4.46%
Yule Catto & Co (YULC) 178.60p +4.02%
JPMorgan Indian Inv Trust (JII) 340.00p +3.91%
Henderson Group (HGG) 101.40p +3.68%
Aquarius Platinum Ltd. (AQP) 169.30p +3.67%
Exillon Energy (EXI) 287.90p +3.60%

FTSE 250 - Fallers
Paragon Group Of Companies (PAG) 170.60p -4.21%
Redrow (RDW) 119.20p -2.53%
Hays (HAS) 63.70p -2.52%
Rathbone Brothers (RAT) 1,012.00p -2.50%
Ocado Group (OCDO) 54.90p -1.96%
Ophir Energy (OPHR) 307.20p -1.85%
Kier Group (KIE) 1,394.00p -1.83%
Grainger (GRI) 103.10p -1.81%
Galliford Try (GFRD) 469.90p -1.69%
Synergy Health (SYR) 859.50p -1.66%

Related share prices
AstraZeneca (AZN) share price
Barclays (BARC) share price
GlaxoSmithKline (GSK) share price
Lloyds Banking Group (LLOY) share price
Marks & Spencer Group (MKS) share price
Royal Bank of Scotland Group (RBS) share price
Tesco (TSCO) share price
Antofagasta (ANTO) share price
Cairn Energy (CNE) share price
Vedanta Resources (VED) share price
Gulf Keystone Petroleum Ltd. (DI) (GKP) share price
Kazakhmys (KAZ) share price
Debenhams (DEB) share price