1:00PM New York, 6:00PM London – A fall in retail sales in December prompted a decline in pound on the speculation that rates may lowered.

Stocks in London gained after commodity stocks and retailers helped snap a four-day decline.

In London trading FTSE 100 stocks rose fractionally by 0.01% or 0.7 to 5,901.70.

Of the 102 FTSE 100 stocks 55 gained, 41 declined, and 6 were unchanged. Xstrata led gainers with a rise of 8.59% on speculation BHP Billiton had renewed its bid for Rio Tinto Plc.

Other commodity stocks gained as well. Rio Tinto soared 4.93% and BHP Billiton surged 2.15%.

The Office of National Statistics reported today that sales volume in the quarter to December rose 0.4% from the previous quarter. Sales in the three months to November had climbed 0.1%.

Three-monthly sales volume jumped 0.3% for food stores, while it remained unchanged for non-food stores.

According to the ONS, each sector of retailing rose except for non-specialized stores such as department stores which declined the most since July 2005 by 1.6%.

However sales in non-store retailing and repair gained the most since October 2006 by 4.4%.

Total sales volume in the three months to December increased by 3.6% from a year earlier, while sales volume for predominantly non-food stores surged 4.4%.

Sales volume for textile, clothing and footwear stores was the lowest since February 1999 at 1.0% and sales volume for predominantly food stores edged up 0.9%.

Total sales volume declined by 0.4 % between November and December, with sales volume for non-food stores fell by 0.9% and volumes for non-specialized stores declined 4.3%, the largest decline since February 1994 when it fell 4.8%.

Non-seasonally adjusted value of retail sales for the quarter to December was 2.3% higher than in the same period a year earlier. The average weekly value of sales in December was 1.4% higher than a year ago at 6.8 billion pounds.

Of the FTSE index shares Xstrata led advancers with a rise of 8.59% followed by rises of 6.03% in Sage Group, of 4.93% in Rio Tinto Plc, of 4.88% in Home Retail Group, and of 4.34% in Kingfisher Plc.

Rio Tinto advanced on the speculation that BHP Billiton is prepared to offer 3.5 shares and A$16 per share Rio from the earlier offer of three-for-one offer.

Retailers also rose on speculation that the Bank of England will cut interest rate after sales unexpectedly slipped by 0.4% in the three months to December. Marks & Spencer gained 3.82%, Sainsbury Plc increased 2.70% and Next advanced 2.22%.

Homebuilders gained as well. Taylor Wimpey climbed 3.31% and Persimmon edged up 2.06%.

Standard Life led declining FTSE 100 index shares with a drop of 6.31% followed by losses of 5.84% in Prudential Plc, of 5.56% in Schroders Plc, of 5.23% in Icap, and of 4.32% in Old Mutual.

Financial stocks fell on the lingering worries related to ongoing correction in the housing market in the U.S. Barclays plunged 3.43%, Royal Bank of Scotland shed 3.30%, and Standard Chartered fell 1.84%.

RAB Capital Plc reported today net income rose less than 2% last year to 135 billion pounds. Also assets under management rose 38% from a year ago to $72 billion, while management and performance fees climbed 3.3% to 123 million pounds.