UKX FTSE 100 Index

By Carla Mozee, MarketWatch

Shell shares rise on reports of Iran field

U.K. stocks climbed Wednesday, on track for a third straight session of gains as mining stocks leapt, with Rio Tinto PLC higher following a ratings upgrade.

The U.K's FTSE 100 gained 1% to 6,846.98, with only the utilities sector left in the red. The index on Tuesday rose 0.5% (http://www.marketwatch.com/story/pounds-march-higher-pulls-exporter-heavy-ftse-100-lower-2016-12-06), staging a turnaround as bank stocks advanced.

Miners: The basic materials sector rose the most, with Rio Tinto PLC (RIO) (RIO) (RIO) springing up 3.9% after Credit Suisse raised the diversified miner's rating to outperform from neutral.

Attractive valuation and "vanishing iron ore surpluses as steel production rises and supply growth declines" were among the reasons for the upgrade, said Credit Suisse research analyst James Gurry in a note released Wednesday.

Glencore PLC (GLEN.LN) is Credit Suisse's preferred major in the mining space alongside Rio Tinto, the analyst said. Glencore shares were up 2.5%. BHP Billiton PLC (BLT.LN) (BHP.AU) (BHP.AU) was downgraded to neutral from outperform, but its shares were still up by 2.3%.

"We maintain our positive view on the sector," said Credit Suisse, adding it expects "apparent demand trends to continue to recover following the aggressive destock through 2014-15," among other drivers for the sector.

Other movers: Elsewhere, shares of oil producer Royal Dutch Shell PLC (RDSB.LN) (RDSB.LN) were up 1% following a Wall Street Journal report that the company will develop a major oil field in Iran.

WPP PLC (WPP.LN) shares were down 2.1%. The advertising company is spending roughly $70 million with social-media app Snapchat (http://www.wsj.com/articles/wpp-spending-70-million-with-snapchat-1481062337) on behalf of its clients, said WPP Chief Executive Martin Sorrell.

Data docket: Figures on manufacturing production in October are due at 9:30 a.m. London time, or 4:30 a.m. Eastern Time.

The pound was buying $1.2624, down from $1.2678 late Tuesday in New York. Sterling traded at a two-month high, above $1.27, against the greenback in the previous session.

(END) Dow Jones Newswires

December 07, 2016 03:57 ET (08:57 GMT)

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