Tobaccos, drugs, commodities drive FTSE higher 

The top share index closed higher on Monday, driven by strong tobacco stocks, drugmakers and commodity issues, though banks fell on concerns about capital constraints. Skip related content

The FTSE 100 ended up 47.60 points, or 0.8 percent, at 5,943.85, bouncing back after shedding 1.8 percent over the course of last week.

Defensive tobacco and drug stocks were in demand as investors, uncertain on the outlook for the domestic and global economy, sought companies deemed to be resilient.

Both the tobacco and pharmaceutical sectors have underperformed the FTSE 100 in 2011.

"It could be there is a bit of hedging of bets going on here, hence the fact that (investors) are buying defensives at the same time as piling into stocks which are clearly highly cyclical," Peter Dixon, economist at Commerzbank, said.

Cigarette maker British American Tobacco was the standout FTSE 100 gainer, ahead 4 percent, while peer Imperial Tobacco rose 2 percent.

Drugmakers GlaxoSmithKline and AstraZeneca , meanwhile, added 2 percent and 2.3 percent respectively, with the latter scheduled to release full-year results on Thursday.

"There are still concerns on the macro perspective; the potential for China overheating, resulting inflation and predictions of tighter monetary policy there continue to weigh on investors' minds along with the European sovereign debt crisis," Henk Potts, equity strategist at Barclays Wealth, said.

KEY DATA EYED

Traders said investors were also cautious in a week which sees the release of GDP data from both the UK and the United States, as well as the outcome of the latest two-day Federal Reserve Open Market Committee meeting.

Miners were in demand, tracking the copper price higher, with supply constraints supporting the outlook for the metal.

Buyers also came in for energy stocks , which continued their ascent after a hefty sell-off on Thursday, despite a weaker crude price.

On the downside, banks were the biggest fallers on fears they could face greater balance sheet strains under proposals from a government-backed commission to make their retail arms safer.

Royal Bank of Scotland , which rose 6.5 percent on Friday on reports the part-nationalised bank could leave the government's asset protection scheme early, fell 1.9 percent.

Invensys shed 2.9 percent as Goldman Sachs cut its rating for the engineer to "neutral" from "buy" in a review of European capital goods companies.

Back among the risers, Whitbread gained 3.1 percent after the hotel group was upgraded to "buy" by Citigroup, which sees it trading cheaply after cost cutting and an increase in room numbers.

(Editing by Jane Merriman)